X-Gen for Funds: Dealing with automation in the Fund Industry

According to SWIFT’s market analysis in 2008, Luxembourg were sending over 25% of transactions via Proprietary FTP solutions, and over 30% by fax or other manual means. The ability for investors and clients to select third party funds to meet their requirements is forcing the Fund industry to think seriously about implementing the Fund “Open Architecture”. However, the implementation of Funds Open Architecture remains expensive and many areas of the process remain incomplete. As an alternative, Swissrisk Financial Systems’ X-Gen for Funds offers technology to immediately close a series of tactical gaps inexpensively, avoiding the need to commit to an investment in a complete solution for Open Architecture STP. Swissrisk has chosen to widen its solution portfolio in the area of funds messaging and workflow in response to the following market drivers: Act now: • The growing demand for international standardisation In November 2012 all ISO15022 Funds messages have to be • SWIFT’s initiative to have the migration of ISO15022 replaced by ISO20022 formats Fund processing messages to ISO20022 by the end of 2012

• The rapidly increased acceptance and usage of XML based messaging

X-Gen for Funds allows clients to improve their STP for Fund- processing by combining all the relevant market Standards such as SWIFT ISO15022, ISO20022, EMX as well as proprietary messaging formats. Automated validation, exception handling as well as the monitoring of transaction life-cycles are core features of X-Gens offering. Project implementation time and customer time-to-market can be dramatically reduced.

Swissrisk Financial Systems celebrates 12 years SWIFT Ready Gold Financial EAI About X-Gen for Funds

Different Message Formats, dissimilar Processes, Rapid Time to Market, quick return on investment, dissonent Channels and applications Flexibility to Adapt

Fund processing involves financial advisors, bank branches, X-Gen for Funds is built to extend the functionality of existing custodians or depot-banks, distribution hubs or -platforms, production systems but not to replace them. It is the gaps transaction banks and transfer agencies. As a result, the in existing messages, business processes and flows which end-to-end processes are complex. Also there is a wide and are ideal targets for X-Gen for Funds, avoiding costly diverse catalogue of standard fund message types in use: reprogramming of functionality in legacy systems. The funds distribution value chain is rapidly changing and flexibility for • SWIFT FIN (formatted and unformatted) the future is key. • SWIFT XML (ISO 20022)

• Domestic protocols such as Investro (Germany) How does X-Gen for Funds work? or EMX (U.K) X-Gen for Funds is tailored for the special needs of the funds distribution market. Using X-Gen’s graphical development Just as challenging, and not immediately apparent, is the fact toolkit both business and systems analysts can: that every message type in use is designed to support different • Map messages, including use of logical operators within business processes with different underlying technology message structures plus Swissrisk Financial Systems’ infrastructures and communication protocols. Managing such library of industry standard messages (SWIFT, FIX) a diversity of counterparties, messages, business processes and infrastructure requirements is a core competency of • Create data end-to-end process flows X-Gen for Funds. • Manage and create automated routines for process mis-matches X-Gen for Funds: A Market Tested Solution • Create web based application screens for business X-Gen for Funds specializes in the message types and users (for example to create, repair, match or business processes most often used within the funds monitor transactions) distribution industry. The technology is supported by our team of professionals, each with specific domain knowledge and X-Gen for Funds allows you to comply with important industry experience. international standards as well as protecting your investments in legacy applications. The main reason that our clients have chosen to implement X-Gen is because of its scalability, flexibility and its potential to Managing the diversity of messages, business processes realise cost savings while immediately adding benefit. and communications flows is the core competency of X-Gen for Funds. Planning for SWIFT Milestones

In autumn 2008, the SWIFT Board Euroclear presented a milestone plan for phasing out ISO 15022 (MT) messages for funds, Clearstream with the decommissioning of the MT Financial Fund Transfer Luxembourg/ Fund Templates by the end of 2012. In Advisors Platforms Agents Dublin Funds the meantime, it is planned that by the SWIFT ISO15022 end of 2010 that the “Top 20” market SWIFT ISO20022

EURO

1EURO participants will be exchanging ISO 20022 11EURO FTP Investors Email (XML) messages with each other. There EMX Central Order Desk National is no time to loose to begin planning the at Depotbank Funds conversion to ISO 20022. Bank Central Branches Custody Department Success Story

Schroders implements SWIFT based Fund Hub powered with X-Gen “Thanks to X-Gen we have significantly reduced project implementation and , one of the world’s client on boarding time. The user friendly largest independent investment managers, has implemented development environment allows us SWIFT ISO15022 and 20022 XML messaging for its to plan, implement and test new client Luxembourg based Transfer Agency business. Supporting the connections much quicker and in a higher new standards, Schroders is able to gain more international quality than before.” business, including third party distribution in Asia and the Americas. Thanks to X-Gen, a business process automation Rainer Aisch, Project Manager, middleware, the time to get new clients onboard has been Schroders IM reduced from three months to two weeks only. The Solution: The Challenge: X-Gen becomes a Funds Processing Hub ISO20022 for SWIFTNet Funds for all SWIFT Messages

In the past the Luxembourg transfer agency business has Schroders decided on Swissrisk’s messaging and workflow been very much fax driven. A higher level of STP has been suite X-Gen for the implementation of the new SWIFT Funds achieved with SWIFT ISO15022 messaging, which Schroders Hub. X-Gen provides embedded SWIFT libraries for all had implemented using a proprietary messaging solution. ISO15022 and ISO20022 message standards. Thanks to a Maintenance effort was extremely high because of the need for graphical rule designer which allows non-programmers quickly additional programming for yearly SWIFT standard releases to develop transformation and workflow rules, the project and implementation of new distributors: each distributor link was implemented within a timeframe of only three month. had to be configured and developed separately. The system Schroders has trained its own staff in X-Gen technology and couldn’t handle XML messages, which was a serious deficit, is now able to implement new rules on their own. Due to the especially as Asian clients tend to migrate directly to XML success of the ISO20022 implementation, Schroders then messaging from the existing fax infrastructure. Getting new decided to migrate their ISO15022 based SWIFT traffic to the clients on board quickly and the readiness for new XML X-Gen system. based standards have become an essential success factor A clear, new architecture has been implemented by using for Schroders. X-Gen, which covers both ISO15022 and ISO20022 with the same approach and the same technology. A high level of Benefits brought by X-Gen STP processing includes an interface to the Transfer Agency The new system allows Schroders to reduce the time required System. to integrate new clients from three months to Fund SWIFT Schroders IM two weeks. Thanks to the new architectural Distributors approach, operations and maintenance costs could be significantly reduced. The investment in the X-Gen software is Workflow ISO20022 Subscription / Redemption an investment in the future: Because of its XML Orders Mapping Debulking SWIFT certification, X-Gen complies with Subscription / Redemption Transfer all SWIFT standards and will also provide Validation ISO15022 MT502 Agency all upcoming SWIFT release maintenance FIN System for the benefit of Schroders. ISO20022 Subscription / Redemption XML Order Confirmation Mapping Bulking Status Report

ISO15022 MT515 FIN MT509

Process flow for SWIFT ISO20022 and ISO15022 messages at Schroders IM Solution Benefits

Make your Migration to SWIFTNet Funds (ISO20022) with Swissrisk expertise and X-Gen for Funds! Efficient processes require efficient and powerful designer Some clients of X-Gen for Funds tools. X-Gen Is shipped with a full graphical rule designer Allfunds Bank for development of workflows, transformations, data objects Brown Brothers Harriman and web based presentation screens. This results in faster Asset Management time to market and less processing errors. A graphical rule DekaBank execution tracer allows users to overlay the rule presentation European Fund Administration with operational values of data objects. Users may quickly Hauck & Aufhäuser Bankiers Luxembourg S.A. locate errors or configuration failures by using the rule tracer. IFSAM Schroders IM Unicredit X-Gen, a SWIFT Ready gold certified solution:

One of the few solutions that are developed especially for SWIFTNet is the Business Process Engine X-Gen, certified by the SWIFT Ready Gold Label for Financial EAI since Benefits of X-Gen for Funds 1999. X-Gen is SWIFT Ready Funds certified since 2004. • Time required to integrate new clients can be X-Gen provides powerful legacy connectivity, message reduced from months to a few weeks format handling, business transformation and validation, complimented by a built-in workflow engine and web based • Complies with all relevant international message application screens for business users. Fully XML based, standards (including SWIFT ISO20022) X-Gen is 100% SWIFT ISO20022 XML compliant – the ideal • Process flows can be tailored to exact client needs application for end-to-end STP projects. • Gaps in process flows will be closed while investments into legacy applications are protected • SWIFT certified solution

Swissrisk Financial Systems GmbH Holzhausenstr. 44 Tel +49 69 50952-0 [email protected] 60322 am Main Fax +49 69 50952-333 www.sr-financial-systems.com