Fintech weekly deals and partnerships roundup

Fnality confirms £50mn equity round for wholesale banking crypto

The Utility Settlement Coin (USC) is moving into its next phase of maturity with the creation of Fnality International and completion of an associated ‘Series A’ equity round of £50m. The founding shareholders of Fnality comprise: Banco Santander, BNY Mellon, Barclays, CIBC, Commerzbank, Credit Suisse, ING, KBC Group, Lloyds Banking Group, MUFG Bank, Nasdaq, Sumitomo Mitsui Banking Corporation, State Street Corporation, and UBS. Clearmatics continues in its role as the technology partner to Fnality.

The goal of earlier stages of the USC project centered on research and development efforts to solve for a more efficient means of international cross border payments in tomorrow’s world of tokenized wholesale markets while reducing settlement risk, counterparty risk and ultimately system risk in the post-trade settlement process.

The focus for Fnality is now to create and deploy a solution incorporating legal, regulatory, operational and technical aspects, to create a regulated network of distributed Financial Market Infrastructures (dFMIs) to support global exchange of value transactions. Initially, five currencies are in scope: CAD, EUR, GBP, JPY & USD. Further currencies will likely be added in due course.

USC envisages being 100% backed by fiat currency held at the respective central bank with convertibility into fiat currency at par guaranteed at all times. In each jurisdiction, the Fnality solution will ensure that settlement is achieved under the local settlement finality laws and regulations. Rhomaios Ram, CEO of Fnality, said in a statement: “USC will be an enabler for tokenised markets and also offers a significant opportunity to simplify liquidity management using one cash asset for as many settlement needs as possible.”

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LSEG acquires fixed income ESG provider

London Stock Exchange Group (LSEG) announced it’s acquired Beyond Ratings as part of continued investment in the Information Services business, including FTSE Russell. Beyond Ratings is a provider of Environmental, Social and Governance (ESG) data for fixed income. The acquisition will be funded from existing facilities. The terms of the transaction have not been disclosed.

The acquisition offers a significant opportunity for LSEG’s Information Services business to enhance its multi-asset data and analytics capabilities and to further commercialize Beyond Ratings’ existing datasets globally. FTSE Russell will also look to further develop its multi-asset index solutions, using Beyond Ratings’ sustainability data, smart risk models and ESG research expertise.

Beyond Ratings’ analytics suite offers customers the ability to systematically and transparently incorporate ESG criteria into their credit risk analysis. Founded in 2014 and based in Paris, France, the company provides services to assist the financial sector with standard research and tailored services, leveraging in-house expertise, advanced quantitative analytics and risk scoring for over 175 countries and 10,000 companies.

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INTL FCStone picks Eventus Systems for market surveillance tech

Eventus Systems announced that INTL FCStone has signed with the firm to provide its futures market surveillance technology. INTL FCStone recently announced several expansion initiatives and deployed the cloud implementation of the Validus platform, replacing its current outsourced system.

Eventus now provides trade surveillance and financial risk management to more than 20 percent of registered US futures commission merchants (FCMs). Also deploying the Validus platform are a growing list of exchanges and firms participating in a wide range of global asset classes, including equities, options, foreign exchange, fixed income and cryptocurrencies. It’s just added three new exchanges and its first Swap Execution Facility (SEF) for market surveillance coverage.

Sandra McCarthy, chief compliance officer for the FCM Division of INTL FCStone Financial, a subsidiary of INTL FCStone, said in a statement: “Eventus offers us an outstanding system with great market coverage. Validus has been very easy to implement, and its staff has worked with us to ensure the technology promotes cost and time efficiencies while addressing matters of interest to regulators.”

Validus helps firms monitor for unwanted market manipulation behavior such as spoofing, layering and wash trading, as well as provides functionality for a wide range of procedures, including Indicative Opening Price (IOP) and compliance with Tag 50 requirements. The platform enables full compliance with all trade-related regulatory and exchange requirements globally.

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BBVA partners with NetApp for hybrid cloud data management

BBVA and NetApp, the data authority for hybrid cloud, announced an alliance that makes NetApp a priority technological partner for BBVA. This is part of a series of strategic agreements the banking group is implementing to become a more flexible and scalable digital bank. NetApp’s data services portfolio are expected to simplify and integrate data management across cloud and on-premises to accelerate digital transformation.

Through this agreement, BBVA will be able to deliver consistent and integrated hybrid cloud data services for data visibility and insights, data access and control and data protection and security to address the high demands on the company’s digital services. Other priority technological partners include companies like Cisco, Red Hat, Salesforce, Amazon Web Services and IBM.

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Canaccord invests in AI hedge fund Castle Ridge

Artificial intelligence-powered hedge fund, Castle Ridge Asset Management, announced today that it has accepted a strategic investment from Canaccord Genuity Group (Canaccord Genuity), a global financial services firm that specializes in wealth management and capital markets. Financial details are not disclosed.

The investment will enable Castle Ridge to expand its distribution channel with Canaccord Genuity Wealth Management, which manages over $60 billion in client assets in Canada, the UK and Europe, and Australia. Castle Ridge, with offices in Toronto and New York, offers hedge fund investment strategies powered by its proprietary artificial intelligence system, named WALLACE.

Adrian de Valois-Franklin, CEO of Castle Ridge, said in a statement, “Our proprietary WALLACE AI platform constantly adapts to ever changing financial markets. WALLACE is the culmination of 20 years of experience of what works, and more importantly, what does not work when trying to apply machine learning techniques to the markets. As a result, we developed a completely new branch of self-evolving artificial intelligence called Geno-Synthetic Algorithms.”

Alex Bogdan, Chief Scientific Officer, said in a statement, “Clients will gain access to a truly unique set of uncorrelated investment strategies driven by Castle Ridge’s explainable and transparent AI. What really sets the system apart is the ability to spot market behavioral patterns that are hidden to human managers and traditional static systematic strategies.”

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Solactive invests in ESG researcher Minerva

Solactive announced the completion of a strategic investment in Minerva to accelerate the growth of the electronic voting, stewardship, and ESG research services firm. Financial details were not disclosed. Solactive is a German index engineering firm.

Following the deal’s completion, Minerva will build-out its research and client service capability through Solactive’s offices in Frankfurt, Hong Kong, and Toronto, while using Solactive’s technological capabilities in the fields of natural language processing to broaden its product suite. Minerva will now be able to offer clients global coverage, 24 hours a day. Solactive will seek to use Minerva data in the continued development of its offerings.

The founders of each company are committed to using technology to develop client-centric bespoke solutions. This will be of particular importance, as regulatory shifts increase demand for customized sustainable stewardship strategies, most notably with Shareholders Rights Directive 2 (SRDII), which becomes effective next month.

Solactive CEO Steffen Scheuble, said in a statement: ”This is an important step for us in ensuring that we stay relevant to the entire asset management ecosystem. Quality governance and sustainability data, research and analytics as well as voting technology and services solutions are areas of increasing importance to all asset owners and asset managers.”

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Gresham signs with global clearing services provider

Gresham Technologies, a software and services company that specializes in providing real-time data integrity and control solutions, announced that it has signed a contract with an undisclosed global multi-asset class clearing house.

The firm has selected Gresham’s Clareti platform, including Clareti Transaction Control and Clareti Adaptors, to replace fragmented legacy tools and manually intensive reconciliation and control processes with a new enterprise-wide solution to be used across the firm’s international clearing operations.

The Clareti platform can handle complex message structures, file types and database formats found in the OTC and listed interest rates, fixed income, FX, CDS, equities and commodities markets as well as a myriad of other use cases. The 5-year term, worth £1.2M in value, represents Gresham’s third contract of over £1M closed in 2019 to date.

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KRM22 to acquire Object+ to expand market risk management offering

KRM22 announced it’s signed a definitive agreement to acquire Netherlands-based Object+, a risk management and post-trade services technology company for capital markets firms. KRM22 is a technology and software company focused on risk management in capital markets that offers post-trade market risk solutions through previous acquisitions and partnerships.

Adding Object+ capabilities to KRM22’s existing product suite enables the firm to expand its market risk solutions to include pre-trade and at-trade functions that connect directly to major global exchanges. The acquisition will also enable KRM22 to share data between systems, eliminating the need for multiple market data sources and reconciliations for its customers, thereby reducing the cost and complexity of their risk management processes.

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