Model-based software for the global securities industry
Press release
Inaccurate reference data costs industry millions a year. Average direct costs for a mid-sized broker-dealer are $1.4 million per annum.
London May 15 2003: An audience of 40 senior managers from 30 leading financial institutions heard that inaccurate reference data costs the industry millions a year, at a seminar, jointly organised by Coexis and City Consultants and held at the City Club, Old Broad Street, this week.
Tony Kirby, Chairman of the Reference Data Users Group, addressing the meeting, said: ”Inaccurate reference data is the cause of 30% of trade failures. Using the data from industry surveys, we can conservatively say that for a mid-sized broker-dealer the direct costs are $1.4 million per annum”. He advised the audience, made up of senior executives from companies such as JP Morgan Chase, HSBC, CSFB, Deutsche Bank, BNP Paribas, Nomura, Cazenove, Commerzbank, Cantor Fitzgerald, AXA Investment Managers and Cogent, that “to really do the "know your client" checks, requires a bank to understand the hierarchical parent/child relationships between legal entities.”
Euan Ramsay of City Consultants gave the example of one global financial organisation recently admitting that they have 30 systems containing customer information and changes can take a month to be reflected in all of them. He commented: “Reference data is the oil that lubricates the trade processing life cycle.”
Don Simpson, Head of Operations & Technology, Mitsubishi UFJ
Securities International plc (MUSI) (formerly known as Mitsubishi
Securities International and Tokyo-Mitsubishi International) who
has implemented Coexis’ Syn
Customer and SynSettlements applications and moved from 0 to 95 per cent STP on cash trades,
said: “For Japanese clients we need total confidence that the
information that MUSI’s systems send to clients is correct.
The key to this is accurate reference data. Data models are important
but it is getting the process right that provides the credibility
of reference data management we need.”
Tim Rhodes, founder director of Coexis also highlighted that reference data is as much a process as a data problem. “It is a mistake to think of it as static data. Managing the complex and ever changing hierarchical relationships between legal entities is vital. Client reference data processes must interact with trade processes to enable the rapid repair of reference data related exceptions “
About City Consultants
City Consultants is a specialist consultancy focusing solely on the
Financial Services Industry. Consultants have extensive backgrounds
in and hands-on experience in banking, banking regulation, risk management,
investment management, insurance and wealth management.
Press contact: Salli Roskilly Saffron Communications Limited
T: +44 (0)1763 208708 E:salli at saffroncoms.com
Further information from Donal O’Brien Coexis Limited
T: +44 (0)207 251 7200 E: donal.obrien at coexis.com