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Reference Data: Tech Mahindra Details Global Data Utility Based on Acquired UBS Platform

Tech Mahindra, a business process outsourcing specialist and parent of London-based investment management technology consultancy Citisoft, has repositioned a reference data platform acquired from UBS Global Asset Management to offer an offshore reference data utility aimed at meeting market demand for lower cost, high quality data that can reduce risk and increase efficiency.

The global data utility has been introduced under the Tech Mahindra Managed Data Services brand and offers securities reference data across all asset types, reference data for corporate actions, tax information and end-of-day and intra-day validated pricing data. The utility handles data cleansing and validation, with clients buying licences to access the data.

Tech Mahindra suggests the utility differs from other offerings in the enterprise data management market as it is owned by the company and can be developed. It is also agnostic on data feeds, including 20 from vendors including SIX, Markit, Bloomberg, Thomson Reuters and DTCC.

The company’s first customer is UBS Fund Services in Luxembourg. Under the terms of a five-year services contract with UBS, Tech Mahindra will create and store golden copy data and provide multiple intra-day golden copies to the asset manager. As part of the acquisition and customer deal, Tech Mahindra, which is headquartered in Hyderabad, India, will take on some staff from UBS Global Asset Management who were working on the platform in Luxembourg, but most staff will be located in India.

As a repositioned platform, Tech Mahindra MDS already covers all time zones, markets and asset types, updates 2.5 million issuers on a daily base, receives 200,000 customer price requests and validates 75,000 prices. Some 20,000 corporate actions are checked every day, along with 1,800 tax figures. Looking forward, Tech Mahindra plans to extend these metrics and add reference data around indices and benchmarks, legal entity identifiers and clients.

While Tech Mahindra will lead sales of the service to the banking, financial services and insurance sectors, Citisoft will be able to provide consultancy as necessary. Steve Young, CEO of Citisoft, says Tech Mahindra MDS has been designed to improve data quality and drive down the total cost of data ownership, in turn reducing risk and increasing efficiency. To manage clients’ cost issues, the company has built a toolkit into the data management system that allows users to analyse the cost of owning data, including people, processes and technology. Data quality will be underpinned by service level agreements and key performance indicators will be added as more clients sign up for services and data volumes grow.

Reflecting on the data challenges faced by financial firms, Citisoft Group CEO Jonathan Clark, concludes: “Outsourcing models have evolved over time and attitudes are changing as firms acknowledge that there is a big difference between outsourcing and offshoring, and that captive outsourcing is not an efficient approach. The need is for a commercial relationship with a centralised data utility that can deliver high-quality, accurate data and a lower total cost of ownership.”

Source: Reference Data Review, 24.07.2013

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Filed under: Corporate Action, Data Management, Data Vendor, Market Data, Reference Data, Standards, , , , , , , , , , , , , , , , ,

News and updates on LEI standard progress and development

As a follow up on G20 acceptance in Los Cabos in July 2012 and the Financial Stability Board guidelines and recommendations of the Legal Entity Identifier  LEI, we will regularly update this post with news and article to provide an overview of  LEI standard progress and development.

 
First Published  13.07.2012 , Last Update 27.09.2012

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Reference Data: LEI system Real and Ready for Use…or maybe not?

The morning after the G-20 leaders endorsed the Financial Stability Board’s recommendations for a global system of precisely identifying legal entities, the co-chairwoman of the LEI Trade Association Group said, “I think we have something that is real and ready for use.’’

Robin Doyle, a senior vice president at JPMorgan Chase, noted that 20,000 ready-to-use “legal entity identifiers” have already been generated by a prototype jointly developed by the Depository Trust and Clearing Corporation and the Society for Worldwide Interbank Financial Telecommunication. A copy of that file can be downloaded here.

The online portal that would allow financial market participants to register and receive 20-character ID codes and to search for the codes of counterparties or other entities was demonstrated Wednesday morning at the 2012 Technology Leaders Forum of the Securities Industry and Financial Markets Association.

That portal can be turned live “within 24 hours” of its need, said Mark Davies, 
Vice President, Business Development
 at The Depository Trust & Clearing Corporation, during the demonstration.

The LEI Trade Association Group represents a group of firms and financial industry trade associations trying to develop a global and uniform legal entity identifier. The group is supported by the Global Financial Markets Association, which includes SIFMA.

SIFMA and a variety of other trade groups have recommended that DTCC and SWIFT operate a central authority for registering and issuing the codes that the leaders of the G-20 industrial nations Tuesday endorsed.

The G-20 endorsed the 35 recommendations of an international coordinator known as the Financial Stability Board.

The board’s recommendations differed in one significant aspect from the SIFMA and trade association recommendation. Where the trade groups recommended a centralized system for registering and issuing ID codes – a point reinforced Tuesdya in opening remarks at SIFMA Tech by SIFMA president T. Timothy Ryan Jr. – the FSB recommended a “federated” registration model. Under that approach, local authorities, aka nations, could and theoretically would act as the agencies for registration, issuing and storing the codes.

The central authority would maintain a database that would be logically managed, but whose contents might be spread around the world, as on servers spread across the Internet.

“We think it can work,” but it has to be set up and maintained properly, Doyle said.

The federated model will only be as good as it adheres to the global standards set by the FSB and the International Organization for Standardization, which defined the 20-character code.

Doyle said a central authority under the FSB approach likely will need to conduct audits of local operating units, to ensure compliance with the overall standards. The challenge will be to make sure the codes are kept correctly and not, in some fashion, duplicated.

The local authorities will need to take on the expense of maintaining high standards. “It is an expensive, difficult process to validate data,” Doyle said.

“A public-facing system like this needs a huge amount of control,” Davies said.

The next shoe to drop on the development of the system will come within the next couple weeks. That’s when Commodity Futures Trading Commission member Scott O’Malia said a decision will be announced on what organization or organizations will handle the registration and issuance of ID codes for the swaps markets it will oversee. O’Malia said at SIFMA Tech Tuesday that the decision among what industry executives say are four competing proposals will come “very soon.”

Srinivas Bangarbale, the CFTC’s Chief Data Officer, said Wednesday that the regulator’s “interim compliant identifier” will support the ISO 17442 standard set out by the FSB and ISO. r

It’s decision to move ahead “presupposed the standard” and that the chosen implementing group would “adopt the standards as published.” The CFTC will not directly or indirectly create another set of reference data for the industry to keep track of

“It’s important to use the standard as soon as possible,” he said, however.

O’Malia said the CFTC is likely to begin issuing IDs as early as September. That is so the commission can fulfill its mandate to oversee interest-rate and credit-default swap markets, as mandated by the 2010 Dodd-Frank Wall Street Reform Act.

The FSB’s implementation schedule calls for a functional system to be ready to use by March 2013.

Source: Securities Technology Monitor, 20.06.2012 by Tom Steinert-Threlkeld

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