Bloomberg announced today the introduction of a new solution in FailStation, its settlement-exception management tool, to support Central Securities Depositories Regulation (CSDR) ahead of the upcoming February 2022 implementation deadline.
CSDR will impact both buy- and sell-side firms and requires that trade exceptions be resolved quickly to avoid a complex schedule of penalties. FailStation facilitates customers’ CSDR compliance through a combination of automated settlement exception management tools and Bloomberg CSDR data. Clients can now prioritize fails based off penalty size, isolate CSDR eligible transactions, and send automatic notifications to internal and external stakeholders and initiate the resolution process, thus augmenting successful settlement rates and minimizing penalties.
FailStation is natively integrated with Bloomberg AIM, a leading order management system, and forms part of a consolidated post-trade operations package where an end-to-end experience links operational efficiency with an optimized front office workflow. Bringing greater transparency to each step of the transaction lifecycle through a unified post-trade workflow, and highlighting settlement exceptions associated with CSDR penalties, delivers a holistic post-trade offering. Further, the processing of buy-ins, cancellations, and custodian communications associated with CSDR can be executed by utilizing AIM’s direct custody connectivity. The solution connects and normalizes disparate data from more than 150 custodian banks, prime and executing brokers to create a comprehensive post-trade network.
“Meeting the requirements of regulations like CSDR can quickly become a cumbersome and often expensive burden for firms,” said Virginie O’Shea, founder & CEO of Firebrand Research. “Solutions that can help customers find transparency in their CSDR compliance processes while also managing costs associated with settlement fails can be a critical tool for success ahead of the February 2022 deadline,”
“Providing clients with robust post-trade solutions natively integrated into our OMS is an important part of our end-to-end buy-side offering to help them navigate the complexity of CSDR without impacting their existing front office workflow,” said Ian Peckett, Global Head of Buy-Side Product at Bloomberg. “As the buy-side faces increased regulatory scrutiny, margin compression, and growing client expectations around transparency and the availability of information, Bloomberg Buy-Side Solutions serves as their technology partner to help meet those requirements by optimizing processes and accelerating the flow of information across the entire trade lifecycle through the use of advanced analytical tools.”
FailStation aggregates real-time pre-and post-settlement exceptions from custodians into a single, normalized, and consolidated view. From a single screen, customers can utilize Bloomberg data to enrich settlement information to analyze and prioritize trade exceptions. This enhanced analysis provides customers with counterparty scorecards to help identify the source of settlement fails. FailStation also provides clients with automated exception management, including tools to streamline unstructured communications around settlement fails, ultimately decreasing risk and operational overhead.
Bloomberg’s Buy-Side solutions deliver front-to-back technology for the investment lifecycle, from decision support and order management, to portfolio management and post-trade services, for some of the largest asset managers, asset owners, and hedge funds. Bloomberg AIM, a leading order management system (OMS), is used by nearly 15,000 professionals at over 900 client firms globally to manage more than $17 trillion in assets. PORT is a multi-asset portfolio and risk analytics solution that delivers advanced risk and return attribution models. PORT has 47,000 active users across 15,000 client firms globally. Bloomberg’s post-trade offering streamlines post-trade workflows and reduce operational risk through reconciliation, straight-through processing (STP), settlement exceptions and collateral management solutions.