Committees: Straight Through Processing Committee
The AMF STP Committee coordinates buy side goals to enhance processing efficiencies. STP is an automated system to system environment that allows the continuous electronic flow of all types of transaction data, both internally and to and from external parties from inception to settlement to reconciliation without the need for intervention by any participants in the transaction. This committee coordinates its work with regulators, utilities, vendors, and other trade groups, such as ISITC.
In 2007 the STP Committee efforts were largely focused on Standing Settlement Instructions and improving data quality and functionality of SSI databases in order to mitigate fails. We will continue to support this initiative in 2008. A new goal for 2008 is to evaluate the confirm/affirm process and determine whether any improvements can be made to the process.
June 12, 2008
The AMF staff is pleased to announce that the AMF STP Committee has a new chair, Jeff Zoller of T Rowe Price. We would like to thank Christian Barsanti of Prudential Investment Management, Chair Emeritus, for his dedication, time and effort spent on the AMF STP Committee. Jon Ambos continues as the liaison to the AMF Steering Committee.
At this time, we would like to update the STP Committee roster, to ensure that everyone’s contact details are accurate and that there is still interest in serving on the Committee. Please email Diane Trupia of the AMF staff if you are interested in this Committee.
Also, please mark your calendars for the next meeting date of the AMF STP Committee on Tuesday, June 24th at 11:00 a.m. Agenda and more information about this meeting to come in the near future.
As you know, one of the initiatives the AMF STP Committee is committed to is improving the data quality of standing settlement instructions in order to mitigate fails. Here is an update from Jeff Zoller of the recent SSI initiative developments:
Notes from Pilot Testing:
- Spreadsheet templates have been populated by the custodian participants (2) and delivered to the investment manager participants for analysis
- Awaiting completion of the spreadsheet templates from the broker participants
- Investment managers will review results against their current repositories (including ALERT)
- Meeting scheduled for last week in June to discuss IM feedback on completed spreadsheets and to determine next steps
Notes from ISITC Scottsdale conference:
- Field-by-field review of the templates validated at a high level the spreadsheet content
- A few additional IMs indicated a desire to participate
- Solicited additional custodian participants (currently two) but are having a hard time recruiting additional firms (additional custodian participants are welcome)
Other activities:
Omgeo conducted a focus session on May 15, 2008, to discuss the current state of the initiative:
- It was determined that the ISITC templates should go live and then the custodians would pursue the question of ownership. There seemed to be general agreement that the custodians would take on some type of ownership role. Omgeo is considering making the ISITC template available as an ALERT Plus template for direct upload.
- Omgeo is working on building out more specific fields, by market, where warranted (e.g., Brazil) to support market specific data requirements.
- Omgeo will provide update on the ISITC initiative (via Jeff Zoller) to the May 15 meeting participants in early to mid July (date to be determined by Mark Bouchea and Jeff Zoller)
March 29, 2007 — AMF STP Committee: Standing Settlement Instructions
As you are aware, one of the major goals of the AMF STP Committee this year is to improve the quality of standing settlement instructions, as incorrect instructions continue to contribute to a large number of fails.
The Reference Data Working Group of ISITC is also working toward this end. An important step in this process is for industry participants to agree on the standard minimum data elements that are required to populate the SSI databases in ALERT and AccountNet. ISITC has documented these data elements in the attached DRAFT Standing Settlement Instruction (SSI) Best Practice Guideline.
Please note that ISITC’s SSI Best Practice is the first and important step in the standardizing SSI data and does not address the feasibility of custodians directly uploading SSI information to the two vendor databases, which is a goal of the AMF STP Committee.
We are circulating this draft to the AMF STP Committee members so that you may familiarize yourselves with these data elements and provide any feedback and/or comments. These data elements will be finalized in the end of April, so please send your comments by April 11th. Comments may be sent to Elisa Nuottajarvi of the AMF staff at enuottajarvi@sifma.org.
Simultaneously, the AMF STP Committee leadership Jon Ambos of Deutsche Asset Management and Christian Barsanti of Prudential Investment Management are planning to meet with Omgeo representatives on April 12th to discuss the SSI project and the following agenda items: 1) Alert Plus functionality, 2) Does Alert Plus meet ISITC Reference Data Committee standards for SSIs, 3) Custodian buy-in for the new upload template, 4) Plans for clean-up/validation of existing data in Alert, 5) Future Plans for Custodian/IM shared entry where Alert Plus has pre-populated SSIs for custodians who sign-up, 6) Future plans for Alert Plus, Integration with TradeWeb. We will send the STP Committee members meeting notes from this meeting to update you on developments.
If you have any questions on the above items, please contact AMF staff: Elisa Nuottajarvi (tel. 646-637-9266) or George Reis (tel. 646-637-9280).
Thank you for your interest and cooperation.
October 31, 2005 — AMF STP Committee Recommends Best Practices
The AMF STP Committee, chaired by Christian Barsanti of Prudential Investment Management and Chris Palmer or Goldman Sachs Asset Management, has recommended best practices relating to block level matching and allocations. These recommendations are the first release in the best practice initiative that began as the SEC published a concept release on securities transactions settlement which discussed the possibility of mandating trade date confirmation and affirmation. The AMF responded to the release by ensuring the SEC that asset managers would support and encourage voluntary STP initiatives. In addition to the now released recommendations relating to block level matching and allocation communication, the AMF STP Committee will define best practices for confirmation matching, security data and performance measurements.
The recommendations state that block level matching, communication of allocations, confirmations and affirmations should occur via automated systems to increase timeliness and accuracy. The block level match should occur within 30 minutes for electronic automated matching and within one hour for manual matching post trade execution. Allocations should be communicated within one to three hours of the block level match based on settlement timeframe as well as the allocation delivery method. The document spells out specific recommended time requirements by settlement timing.
The STP Committee presented the best practice recommendations at the AMF Quarterly Meeting on 9/22 to the asset management community. On 11/3 the Committee has representatives at a panel which will publish the recommendations at The Bond Market Association's Fixed Income Operations Conference, with a large sellside audience.
These best practices are open to comments from the AMF membership. Any feedback should be sent to Elisa Nuottajarvi of the AMF staff at Elisa Nuottajarvi.