Ten Markets, Ten Cultures, One Bank

ISSUE023

ASSETSERVICINGTIMES 28.09.2011 WEDNESDAY AST www.assetservicingtimes.com CONTENTS

J.P. Morgan expands DCC to Brazil, Russia J.P. Morgan plans to expand its DCC business in Brazil and Russia. page2 UK to challenge ECB over clearing rules The UK Treasury is set to legally challenge the ECB over its location policy Regulation-driven technology key page5 Regional focus theme at Sibos The Latin American market has been on TORONTO 23.09.2011 the radar for some time now, and its performance is justifying the interest Technological innovations meeting demands of regula- Delta One desk was still in the headlines as the Sibos page7 tion-driven change, which is impacting business mod- conference began on 19 September. els across the financial industry’s supply chain, was Risk management the focus of delegates at this year’s Swift International “UBS was just the most unfortunate timing. It is surpris- A real time focus is essential, writes Banking Operations Seminar (Sibos) payments and ing that these things still happen. As a result, I don’t Dedication Group’s Greg Pritchard settlement conference. think there is as much power within the financial services industry to push back. Politicians have got the page11 Legislation such as Dodd-Frank in the US and MIFiD bit between their teeth and have put statutes on the and Emir in Europe are resulting in significant structural books and now you had best comply. That is a big chal- Industry training changes, particularly in the UK where ring-fencing of lenge,” said Arun Aggarwal, managing director, UK, Ire- All the leading industry courses over the banks’ retail operations will cause a major upheaval - land and Nordics for Swift. coming months. the combined impacts of new requirements will hit firms page13 with a 25 per cent reduction in their return on equity by Technological developments rising up to meet the challeng- some estimates. es of compliance are a notable trend this year, he adds, at People moves a time when transparency and reporting requirements are Find out the latest hires, and who is get- Meanwhile, the lobbying capacity of the financial indus- anticipated to create massive data flows for firms. And this ting promoted within the industry. try is weaker than ever – UBS’ $2.3 billion loss on its when many firms are still using fax machines. page14 readmore p2 MaplesFS launches in Delaware Deutsche Bank opts for Societe Generale

MaplesFS has expanded its fiduciary services division with the launch Societe Generale Securities Services (SGSS) has been appointed by Deut- of Maples Fiduciary Services (Delaware) LLC. The focus of this new sche Bank AG to act as sub-custodian for its proprietary and client assets office will be to provide independent governance services (directors in Egypt. The migration of assets to SGSS was successfully completed on and member managers) to Delaware based investment funds and asset 11 September 2011. finance vehicles. readmore p2 readmore p2 Ten markets, ten cultures, one bank.

XXXXX Ten Markets-annons 203x40.indd 1 2011-09-12 09.27 NewsInBrief

Pegulation-driven technology finance vehicles places Maples Fiduciary ahead but from an exchange point of view the vertical of many of its competitors,” Guy Major, global co- model has come out as the preferred one.” key theme at Sibos head of Maples Fiduciary, added. “This expansion Continued from page 1 allows the Maples group to demonstrate its com- The point is behaviour, not structures, he says. “I still liken a large part of the financial industry mitment to providing a first class, comprehensive Six Group in Switzerland is a vertically inte- to a cottage industry. It is high time we industria- service to its asset finance clients.” Maples Fidu- grated organisation, but open at every level - lised. In a sense, that is what Swift does. We did ciary Services (Delaware) LLC will operate from the exchange, for example, uses LCH.Clearnet that for correspondent banking and we are do- offices in Newark, Delaware. as a second clearing house in addition to SIX ing it in large parts of the securities and funds x-clear, which in turn uses other settlement industry, such as corporate actions. The amount Deutsche Bank opts for agents. The problem, he notes, are some mar- of manual processing and paper around proxy kets that have hung on to the vertically integrat- voting and corporate actions is unacceptable. Societe Generale ed, but closed model – Germany, Spain, Italy, The industrialisation of financial services is a key Continued from page 1 Poland and Greece, for example. theme that we are propagating,” Aggarwal said. The SGSS custody platform in Egypt will provide “From a commercial point of view, there is down- Traditionally transaction banking has been Si- Deutsche Bank with a range of services centred side potential opening up and maybe not a lot of bos’ heartland, he notes, but a wider range of on custody & settlement. The platform builds on upside potential depending on how competitive the stakeholder community from the securities Societe Generale Group’s extensive experience you already are today,” Kindler says. There are and IT sectors is better represented these days, in the country, where it has been providing cus- still some markets in the EU that have success- notably, chief information officers (CIO). tody services to domestic clients for more than fully resisted being MiFID compliant.” 30 years through its subsidiary NSGB. “We have never had that much of the CIO com- The Spanish stock exchange, as a case in point, munity coming here in the past. But there is This mandate from another international client keeps clearing and settlement in-house while a need and a demand out there. How do you in Egypt is recognition of SGSS’ expertise in the MTFs have struggled to gain market share, he handle [being inundated with data]? How do you region and reflects its continued commitment adds. Compare this to the London Stock Ex- analyse that data? How do you sift it? Some of to North Africa. SGSS is already a leading sub- change, which just last week lost its top spot for that links back to regulation,” Aggarwal said. custodian to international clients in Morocco. European equity trading to Chi-X Europe. It seems that the financial services industry has “It remains to be seen whether MiFID II, Emir moved past denial and to acceptance on the Vertical integration can coexist and potentially additional regulation will help regulatory front, and the remaining questions with interoperability – SIX x-clear these [closed] markets open up,” he says. target the most cost effective and least disrup- tive manner with which to tackle compliance. As European clearers prepare for some 50 per Can the problem be outsourced? cent of the cash equities market to open up over Hub Culture launches Ven the next couple of months, interoperability, or Digital Currency “Whether you like [regulatory change] or not, you the lack thereof, is the hot topic among post- must comply in the most efficient manner pos- trade services providers. Hub Culture is launching the Ven digital cur- sible, while focusing on core business. It is a rency, calculated by Thomson Reuters. win-win-win, be it for the industry participants, “Most markets have been and are organised along their domestic infrastructures,” says vendors or industry bodies this is time for utili- “Hub Culture is delighted to announce that Ven Tomas Kindler, head of clearing relations at Six ties to collaborate and help solve the industries will be available on Thomson Reuters data net- Securities Services, speaking on the sidelines problems,” Aggarwal added. work and desktop terminals globally, which will of the Sibos payments and settlements confer- open new vistas for this currency with institu- ence in Toronto. MaplesFS launches in Delaware tions across the planet. Live pricing on over half a million institutional desktops globally heralds Continued from page 1 “What we have seen with MiFID, on the trading layer, was the introduction of competition in the a key step forward in the evolution of Ven, and Scott Somerville, CEO, said: “Maples Fiduciary form of MTFs. That is cascading downwards in the positive impact it can have on the commu- has established itself as a market leader in cor- the value chain and has reached clearing, even- nities it serves.” said Stan Stalnaker, founding porate governance in the Cayman Islands, Du- tually it will reach the CSD layer potentially with director of Hub Culture, the social collaboration bai, Ireland and Luxembourg. An expansion into T2S as a catalyst.” network driving growth of the Ven economy. Delaware is a natural fit for our investment funds and asset finance clients. Since the credit crisis, Over the next six months, SIX x-clear is set to Thomson Reuters Indices will act as the inde- we have seen investors and managers asking for become interoperable with Chi-X Europe, Tur- pendent calculating agent for Ven, leveraging similar standards and practices to be implement- quoise and Nasdaq OMX Nordic when those its strengths in the index creation business, ed on their US domiciled funds. This office gives projects go live, though the latter is yet to be adding further depth and integrity to the digital us the capability to service these vehicles not only announced. currency. Ven can be found under the following from Cayman but also from Delaware, and allows Reuters Instrument Code: <.VEN>. us to deliver a standard of service we do not be- “It is happening, it is becoming real, the Swiss lieve is currently available in the market.” market and the UK market have migrated to the Lehman’s swaps start to move new interoperability framework,” Kindler says. “The ability to provide fiduciary services to Dela- “The vertical versus horizontal is in some ways a Some half a million Lehman swaps have started to ware as well as Irish and Cayman based asset dogmatic debate, there are fans of either model, get processed using a “central valuation solution”.

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Legacy Asset Management Company (Lamco), John Kehoe, managing director of global sales Cor to the B.I.S.S. Accreditation process for a fully owned subsidiary of Lehman Brothers with and account relationship management at XSP, many years and its continued success in con- the aim of “maximising value over time for the said, “XSP already offers the industry’s most sistently achieving the benchmark tests has firm’s less liquid legacy assets”, has migrated its comprehensive and robust Corporate Actions confirmed the confidence that our customers vast complex swaps portfolio onto one core de- data processing platform with connectivity to a have demonstrated, in our ability to produce rivatives platform and gone into production. global network of vendor feeds, exchanges, de- high quality solutions. We developed MegaCor positories, custodians and prime brokers. Now to be an industry leading corporate actions pro- Immediately after the Lehman collapse three years with the ASX ReferencePoint Corporate Actions cessing system and to gain this independent ago, numerous systems across the firm’s deriva- data mapped directly to the XSP v5 solution, our confirmation of its status is very gratifying. Each tives, bank debt, real estate and commodities port- Asia Pac clients have immediate access to this year the criterion continues to be raised and we folios meant trades were extremely challenging to critical data via the Decillion platform. Addition- feel that attaining the accreditation is testimony unwind. Nine months ago, development began on ally, the availability of ASX data on our latest in- to the expertise and quality of the team at Ver- the necessary central platform that would store novative solutions, the XSP GO! Product Suite meg. This year we have expanded our business Lamco’s large legacy portfolio with the capability and eTRAN+ widget, offers yet another conve- portfolio and customers now have the option of of organising the data going forward. nient way for clients to manage the notifications SaaS, on-premise or bespoke development and and response capture process.” with our new consultancy business we can pro- “[Lamco] gave us an aggressive timeline, nine vide additional support. This is an exciting time months for 500,000 trades because they want- “With the integration of ASX ReferencePoint for Vermeg with many new challenges but we ed quicker time to market to maximise the value data made available through the XSP solution are confident that our recent successes are a of their obligations for settlement,” said Gordon leveraging Decillion’s SaaS offering, financial solid foundation for what lies ahead.” Chan, director of global marketing at Calypso institutions can streamline Corporate Actions Technology, the company providing the plat- processing whilst mitigating operational risks Gary Wright, CEO of B.I.S.S. Research said form. “With Calypso, they are able to perform and maximising STP,” said Frank Hoer, Manag- “B.I.S.S. Research has been analysing Vermeg valuation on a normalised, consistent basis.” er of Market Information at ASX. “For Australian for many years and have become very familiar fund managers who only have a short window with their business and products. However, this Speaking on the sidelines of the Sibos payments to make elections on events such as RAPIDs year has seen Vermeg achieve unprecedented and settlements conference, Chan notes that the (Renounceable Accelerated Pro-rata Issue with success with confirmed sales in many coun- platform, Calypso SaaS, is a service hosted en- Dual-bookbuilds), the power to receive acknowl- tries. This is well deserved as they have a fan- vironment which allows the firm to outsource the edgements immediately is a significant benefit to tastic suite of modules within Megara, which management of applications and infrastructure, all parties involved, such as custodians, hedge also gained ‘Custody System’ and ‘Settlement as well as support of their technology platform. fund managers, broker dealers, asset manag- System’ Accreditations. Vermeg is a remarkable ers, index producers and others.” company with very knowledgeable, dedicated people committed not only to success but more XSP deploys Thomas Lee, chief executive officer of Decil- lion Group, commented, “Since partnering with importantly to their customers. We are pleased to congratulate Vermeg on job well done and look XSP together with its partner Decillion Group XSP in 2009, demand for their proven XSP v5 forward to following their future development. has announced that it is deploying intra-day platform continues to increase. With the XSP Corporate Actions data directly from the Austra- v5 solution live in our SaaS platform support- lian Securities Exchange (ASX). ing clients in Asia Pacific, any financial institu- HSBC Securities Services im- tion in the region can access this state-of-the-art The Decillion Group, a banking software solu- platform in a Cloud environment and leverage plements BI-SAM B-One tions provider and operator of the largest SWIFT the powerful functionality to help manage this HSBC Securities Services (HSS) has suc- Service Bureau in the Asia Pac region, markets complex operation. We look forward to continue cessfully implemented its new performance and supports the XSP® v5 solution in a Software working with XSP and ASX to bring the latest measurement and attribution platform, BI-SAM as a Service (SaaS) environment for the local innovations to the financial community.” B-One (B-One), with the first client now live. B- Asian and Australian markets. With this interface, One will be used to provide performance mea- the XSP Data Management and Scrubbing mod- MegaCor meets the standard surement and attribution analysis to HSS clients ule allows clients to rapidly achieve service levels Vermeg has achieved industry accreditation for around the globe, and is the first stage in a se- for Corporate Actions announcements from ASX its corporate actions processing system Mega- ries of major developments that will be rolled out making XSP’s mapping expertise available for Cor. The accreditation criterion was based on over the coming months. These include: any business that consumes ASX data. a detailed review of MegaCor’s functionality together with Vermeg’s customer support, in- A “true daily” capability that is principally aimed at The XSP v5 platform is XSP’s solution devel- tegration and implementation capabilities. Ver- the fund management sector. This will deliver to- oped to automate each step in the processing of meg and MegaCor’s performance in the bench- day’s performance results, including attribution, to global Corporate Actions. A Microsoft Gold Certi- mark tests was deemed to be outstanding. The the client’s desktop first thing the following morn- fied Partner, XSP re-engineered its platform us- accreditation report due to be published by ing. It will also feature a rolling data update facility ing advanced Microsoft technologies. The XSP B.I.S.S. Research shortly, highlighted the grow- that will capture the impact of any late transactions v5 platform is built around a Service-Oriented ing strength of Vermeg, with confirmed sales or other amendments, so that results are always Architecture (SOA), utilizing Microsoft .NET across Northern and Eastern Europe and the as up to date and accurate as possible. components and Windows Communication UK. B.I.S.S. Research was effusive in its praise Foundation (WCF) and Web Services for global of Tunis based Vermeg, in successfully apply- A choice of five fixed income attribution methodologies. enterprise-wide processing. Accredited with ing its business continuity plans during testing the SWIFTReady label, the XSP v5 platform is times, earlier this year. Further commendations Enhancements to our web-enabled client inter- SWIFT 15022 compliant and combines cutting- in the report concern the new SaaS capabil- face, HSBCnet, that will provide a report writer, edge technology with feature-rich functionality ity and Palmyra Vermeg’s SOA development and extensive ad-hoc inquiry and drill down fa- to mitigate operational risks and costs for end- framework, which has benefited leading bank- cilities covering any time period. to-end straight-through processing (STP). The ing institutions, providing bespoke fast develop- new eTRAN®+ widget leverages the XSP GO! ment and testing. A new attribution methodology specifically for framework to provide clients with a customiz- alternative funds that will show separate long able user interface to manage Corporate Ac- Christian Cure, business development director and short contributions for each asset, featuring tions notification and response processing. from Vermeg said “We have committed Mega- the capability to deal with assets that go from 3 www.assetservicingtimes.com NewsInBrief long to short or vice versa without distorting Being a highly customisable solution with an in- with customisable user interface components the analysis. dustry awarded corporate actions module and a for major functions from within the XSP plat- state of the art reporting engine, Megara avails form. These components can be arranged and Colin Kay, global head of performance mea- high level of flexibility that allows us to excel in customised based on each user’s preference to surement says “This is the first of a series of meeting the needs of our diversified client base, enhance their securities processing experience deliverables that will ensure HSS has a cutting in a fully automated environment”. and help maximise productivity. The XSP GO! edge performance measurement product to mobile app allows clients to view corporate ac- meet the increasingly complex requirements “With the on-going developments to expand the tions notifications and submit elections against of asset owners, managers, and their advis- geographical reach and increase the depth of those corporate actions for downstream pro- ers. The significant investment in this project NBAD Custody product offering, we are looking cessing. is a clear signal of HSS’s commitment to the forward to further cementing our relationship custody business in general, and performance with Vermeg, through replicating the success- Brendan Farrell, chief executive officer at XSP, measurement in particular.” ful implementation of Megara in other projects,” said, “DTCC is focused on delivering compre- Samir added. hensive corporate actions information solutions NBAD implements Megara for to meet the ever-changing industry require- J.P. Morgan expands DCC to ments, while XSP is committed to continuously custody operations developing innovative offerings to keep ahead of Brazil, Russia the ever-increasing market and client demands. The National Bank of Abu Dhabi (NBAD) has J.P. Morgan’s Worldwide Securities Services We share the strong belief that the automation gone live with Megara - Vermeg’s independently of corporate actions processing will position the industry accredited custody system. (WSS) has announced plans to expand its Di- rect Custody and Clearing (DCC) business in industry for radical growth. Our relationship gives Implementation of Megara was in two phases Brazil and Russia. global financial institutions access to flexible, and started in November 2010; firstly with the proven and state-of-the-art tools to automate local custody operation, followed by internation- J.P. Morgan already offers DCC in Russia but their operations and promote greater STP. By al custody. Complete live status was achieved plans to increase its footprint in the market. As combining the XSP v5 platform and XSP GO! in July 2011. Megara’s modular design was part of this growth, Katerina Sizova has joined Product Suite with DTCC’s GCA Validation Ser- instrumental in enabling a risk reduced imple- as head of the business in Russia, and will be vice, the industry will benefit from streamlining mentation that spanned many business areas, responsible for building product capabilities, exe- this complex process while increasing efficien- covering various settlement operations, and cuting on the firm’s growth strategy and enhanc- cies and providing risk-controlled performance. including the installation of the MegaCor mod- ing the client experience. Sizova most recently We look forward to many more years of working ule, a corporate actions system long recognised was global head of operations at the Renais- side-by-side with DTCC to deliver cutting-edge in the industry as a leading solution. Other key sance Group, where she worked for 13 years. solutions to the financial industry.” modules implemented focused on improved client servicing, enhanced client billing and inter- Separately, J.P. Morgan also announced it has Dan Thieke, DTCC vice president, Asset Ser- nal and external reporting. in-sourced its Global Custody business in Bra- vices, said, “DTCC never stops striving to deliv- zil, as part of its expansion. er innovative solutions that meet the demands NBAD specified that it was important that Ver- of the financial services community. Process- meg should provide the best possible technical Rowena Romulo, global head of Direct Custody ing our highly accurate, corporate actions an- and functional environment to meet the high- & Clearing for J.P. Morgan’s WSS business, said: nouncements on securities from more than 200 est global standards. Local and international “The latest expansion is an extension of our pre- countries via XSP’s platform creates a stronger clients of NBAD can expect increased service viously announced plans to grow DCC in mar- solution for the industry. We are excited about levels through a highly automated operational kets where it makes sense for us and our clients. this relationship with XSP, and we look forward processing environment. The completion of this Operating locally gives our clients an integrated to continuing to provide new corporate actions project reinforces the strength of NBAD in the solution across a range of markets supported by solutions for the industry in the future.” region and will enable the bank to become the our leading client service, a unified technology regional hub for international business for se- platform and local market expertise.” curities processing and custody operations, a BNP shortens BDs’ time to primary objective for NBAD. DTCC XSP global corporate new markets Boujemaa Khaldi, sales director from Ver- actions alliance meg said “This has been a model project for BNP Paribas Securities Services has launched Megara and underlines the Vermeg culture of XSP has signed a Certified Software Partner a service allowing financial intermediaries to understanding and working with our clients to agreement with DTCC Solutions LLC. shorten their deployment time to new markets, achieve the best possible outcome. NBAD are optimising liquidity and boosting client service. recognized as the top bank in the region and The XSP v5 platform is XSP’s solution devel- have been awarded a staggering number of ac- oped to automate each step in the processing of Delivered through a single point of contact, BNP colades by the industry, so for them to choose global Corporate Actions. A Microsoft Gold Cer- Paribas’ solution enables access to robust set- Vermeg as their preferred supplier of custody tified Partner, XSP has re-engineered its plat- tlement, clearing and custody services in more system is a wonderful endorsement. We look form using advanced Microsoft technologies. than 100 countries, meaning clients benefit from forward to a long and mutually rewarding rela- The XSP v5 platform is built around a service- smoother instruction, reporting and reconcilia- tionship with NBAD and welcome them to the oriented architecture (SOA), utilising Microsoft tion processes, and faster on-boarding. Vermeg family of valued customers” .NET components and Web Services for global “The implementation of Megara is viewed as a enterprise-wide processing. Accredited with “Our solution removes virtually all of the com- major milestone in our journey to be the leading the SWIFTReady label, the XSP v5 platform is plexity involved with implementing and man- regional custody service provider,” says Hany SWIFT 15022 compliant and combines cutting- aging moves into new markets, thus enabling Samir, the head of custody and co-head of secu- edge technology with feature-rich functionality banks and brokers to react quickly to business rities & funds administration at NBAD. “Through to mitigate operational risks and costs for end- opportunities in new territories,” added Eric availing the best in class integrated solutions to-end straight-through processing (STP). Roussel, head of trade and market services at that meets the increasing demands of investors BNP Paribas Securities Services. investing in the United Arab Emirates Securities The XSP GO! product is one of the latest of- markets, Regional and International markets. ferings from XSP designed to provide clients The service also incorporates collateral man- 4 www.assetservicingtimes.com NewsInBrief NewsInBrief

agement which – critically – will improve clients’ provide the ACD, fund accounting and transfer houses to provide post-trade services in liquidity and their capital usage. By having a full agency services for Chelverton Asset Manage- an environment of regulatory change and view of clients’ operations, the bank is able to ment’s UK OEIC, the Chelverton UK Equity In- dwindling revenues. closely evaluate their collateral requirements come Fund. and recommend – more accurately than ever – The Eurosystem Policy Framework published in the exact amount of collateral required. The Chelverton UK Equity Income Fund seeks to July this year sets out the following: “The abso- provide investors with a relatively high and grow- lute and relative size of an offshore CCP’s euro- BNY Mellon enhances collateral ing income from investment in UK small and mid denominated business provides a useful proxy cap equities. Chelverton believes that the key for the potential implications of this CCP for the servicing platform driver of a share price over the long term is the euro area. The Eurosystem applies thresholds BNY Mellon has enhanced its derivatives col- ability of the business to pay a dividend as a tan- for application of the location policy to CCPs lateral servicing platform for institutional clients gible measure of the underlying cash flow. To this similar to those for payment systems, with new margin management capabilities deliv- end Chelverton’s investment process is focussed ered through a secure web-based portal. on delivering a relatively high level of income that “However, taking into account the specific na- can grow in real terms over the long term. ture of the CCP business, the threshold of €5 As part of DM Edge - the company’s derivatives billion applies to offshore CCPs that on average margin management service - the enhance- The investible universe for the Chelverton UK have a daily net credit exposure of more than ments provide clients with a fully automated Equity Income Fund is defined as UK small €5 billion in one of the main eurodenominated system that facilitates the entire margin call and and mid cap equities with a minimum yield of product categories.” The policy framework notes collateralisation process, improves reporting ca- 50% more than the average for UK small and that the location policy is applied to all CCPs pabilities and reduces operational risk. mid caps on a twelve month view. Chelverton’s that hold on average more than five per cent of discipline at the portfolio level is to construct a the aggregated daily net credit exposure of all portfolio with a relatively high initial yield that CCPs of the main euro-denominated product “Given the growth and complexity of the de- can grow its income in excess of inflation on an categories, chiefly OTC credit derivatives. rivatives collateral management process, it is annual basis over the long term and in doing so imperative we provide clients with a clear, real- it will generate excess returns for shareholders. The ECB declined to comment. time window into reviewing and approving their collateral agreements, margin calls and settle- William van Heesewijk, Chelverton Asset Man- However, any limit or thresholds contravenes ments. Our new portal, DM Edge Connect, does agement, commented: the principles of the single market, said a Trea- that and more,” said Scott Linden, managing “Chelverton is delighted to be working with sury Spokesman, as well as undermines the director and product manager for DM Edge at Phoenix’s experienced team with its track re- euro’s status as a global currency. Additionally, BNY Mellon. “In addition, with our new capa- cord of supporting the growth of specialist fund London is one of the world’s leading financial bilities, we are well positioned to accommodate managers. The comprehensive nature of the centres, home to 40 per cent of global OTC de- the requirements that will emerge in a centrally service provided by Phoenix, offers real value to rivatives trading and some of the biggest clear- cleared environment, as well as the changes re- Chelverton; notably its securities and middle of- ing houses in the world. sulting from global regulatory reforms.” fice administration and its high levels of straight through processing delivered through its propri- LCH.Clearnet, a UK-based global clearing house To help introduce these enhancements, BNY etary software.” in the top three for transactions in interest rate Mellon has partnered with Algorithmics, a lead- swaps, fixed income and repo and futures and ing provider of collateral management solu- John Rice, managing director of Phoenix Fund options, had no comment. However, the rule tions. BNY Mellon’s DM Edge service is part of Services, commented: “Phoenix is very pleased would affect a number of CCPs based outside the company’s Derivatives360 suite of services, to be working with Chelverton with its increasing- the eurozone area that provide services in a which comprises a broad array of offerings for ly impressive track record for delivering value to range of different currencies to clients globally. issuers and investors around the execution and its fund investors. We look forward to supporting processing of derivatives. These include trading their continued growth as they become a recogn- The ECB location policy also, according to the and execution, collateral management and other ised name in the UK funds management world.” Treasury, contravenes international efforts to re- middle office outsourcing services, as well as form derivative markets, where the G20 called custody, accounting and consolidated reporting. for reforms to be implemented in an “interna- Other middle office services available through UK to challenge ECB over tionally consistent and non-discriminatory way, Derivatives360 on an outsourced basis include clearing rules according to the Treasury. cash collateral reinvestment, OTC trade affirma- This statement echoes some of the language tion and confirmation, independent (third-party) The HM Treasury has confirmed the UK is set in an unreleased draft document of the MiFID valuation, counterparty and investment manager to legally challenge the ECB over its recently review circulating in Brussels, as reported by reconciliation and lifecycle event management. published “location policy”, which will require Reuters. The draft includes rules that would a number of financial infrastructure providers, prevent member states from blocking access “Our new margin management capabilities have namely central counterparties (CCPs), that of investment firms and market operators to been well-received by our clients who are in- clear OTC credit derivatives to do so only in a central counterparty and clearing and settle- creasingly turning to BNY Mellon to handle their eurozone country. derivatives servicing needs,” said Patrick Tadie, ment systems. global business head for Derivatives360. “The A Treasury spokesperson said: “This decision range of services we can deliver to investors This UK legal challenge will be the first time contravenes European law and fundamental and issuers highlights the power of harnessing a member State has taken legal proceedings single market principles by preventing the clear- and delivering capabilities from across our en- against the European Central Bank in this way. tire company.” ing of some financial products outside the Euro area. That is why we have begun proceedings “The Government wants to see this resolved against the European Central Bank through the swiftly and without involving the courts, but if European Court of Justice. Phoenix wins fund administra- necessary will not shy away from continuing le- tion mandate with Chelverton gal action to make sure there is a level playing The move comes during a time of increasing field across the EU for British businesses,” adds Phoenix Fund Services has been mandated to competition among exchanges and clearing the spokesman. 5 www.assetservicingtimes.com Financial software solutions that deliver

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Bravura Solutions is a leading global supplier of transfer agency and wealth management software ANNA REITMAN REPORTS applications and professional services. We have over 20 years of experience and support more than The explosive trade relationship between Asia story is developing in the Asia-Latin American That does not change the fact, however, that 180 ﬁnancial institutions globally. We stand at the forefront of our industry; setting the benchmark and Latin America is on the radar of most firms (Asia-Latam) trade corridor. Latin America has global market turmoil is hitting the region hard. and asset servicing providers are expecting the an abundance of raw materials, such as agri- Markus Schomer, managing director and chief for innovative, quality technology applications, service and support. dynamics of the region to work in their favour. cultural and mining products, to meet Asia’s economist for Pine Bridge Investments, remarks demand, while emerging Asia is a low-cost that seeing Latin America undeperform the rest For further information please email [email protected] There is a tendency to treat Latin America as producer of manufactured items such as elec- of the emerging markets by a huge margin “was a homogenous territory, but this region covers tronics, textiles, and clothing, for which Latin surprising” in a report just after global markets eight countries in North and Central America, 12 America is a growing market. nose-dived in the summer. 7491ICFA countries in South America and, if you include In general, the drop is viewed as a temporary the Caribbean, another 13 sovereign states; two “Asia-Latam is one of the world’s fastest grow- overseas departments and 14 dependent territo- correction and certainly does not seem to make ing trade corridors, with China-Brazil trade at its experts on the region think that there will be a ries tied to the UK, France, Netherlands and US core. Growth in the economic and financial link- – although these figures are disputed between slowdown in the tremendous growth of the fund ages between China and Brazil over the past management industry, particularly Brazil’s. different sources depending on definitions. The five years has been impressive,” writes Stan- point is, there is great diversity in the size and dard Chartered. liquidity of markets across Latin America’s part of the Western hemisphere. “B” is for BRICS Furthermore, the region has become a more vi- While the world focuses on political and finan- able export market for Asia because of greater The country most at risk of an overheating econ- cial risks in Europe as well as the disappointing macroeconomic stability resulting from reserve omy is still Brazil. Over the past few years, the performance of the US, writes Standard Char- accumulation, trade/current account surpluses exchange rate shot up, creating a rush of foreign tered Bank in a recent report, a growth boom and more prudent fiscal policy. funds, says Jorge Vrljicak, research director at United Kingdom | Luxembourg | Poland | Australia | New Zealand | South Africa | Hong Kong | Thailand 7 www.assetservicingtimes.com RegionalFocus

Westside Consultants, based in Buenos Aires. foreign exchange,” Vrljicak notes. ground in Rio de Janeiro and to a lesser ex- Last year, some of that pressure was absorbed tent in Sao Paulo, so we have a longstanding by increased productivity and one-off taxes on Whether this move continues to have the presence and a strong commitment not only private capital to discourage funds from coming desired effect remains to be seen, but one to the Latin American market but also to the into the country, yet the risks persist. thing is for sure, Brazil’s funds industry is Brazilian market, which happens to be one of evolving rapidly and becoming increasingly our core strategic global markets,” Kalavri- Economic cooperation between developed savvy and sophisticated. tinos says, adding that BNY Mellon continues economies and Latin America in general had to invest in not just asset servicing but other already been chilling. In 2008, the World Trade “Fundamentally, you are going to have locals af- product and business lines as well. Organisation (WTO) Doha Rounds became ter that business, what I see is that this is going deadlocked, with only half-hearted attempts at to be a very competitive arena…but the growth The largest and most developed onshore revival from the European Union (EU). This was trend will be within the South American region domestic fund market - mutual funds, pen- quickly followed by the Lehman Brothers col- itself,” says Vrljicak. sion funds, hedge funds - is in Brazil. Though lapse, which triggered a financial crisis and the there are no explicitly defined hedge funds in “great recession”. Markets are still see-sawing Asset servicing providers in the region agree. Brazil, a multi-asset fund, or ‘multi-mercado’ in throughout the third quarter of 2011, when most Michael Kalavritinos, managing director at BNY Portuguese, is essentially a similar structure. analysts had predicted an economic recovery Mellon Asset Servicing, the largest independent Mexico, however, is an important retail pension this year. fund administrator in Brazil, sees the same trend fund market and increasingly retail mutual fund developing. He is responsible for Latin America market. And Chile has one of the most progres- and the Caribbean (excluding Brazil onshore). sive pension fund markets since privatisation in The US Federal Reserve’s quantitative easing 1981, says Kalavritinos. programmes did not help matters either, says Vrljicak, adding that this has negatively im- pacted the views that Brazil, and Latin America in general, holds towards the US as an invest- Latin American banks are increasing their ment destination. research staff and coverage of sectors “Brazilians have not responded well to what and of the region as a whole. Guido Mantega, the Finance Minister, calls a ‘currency war’ and while the country had a huge stock of US Treasuries in its foreign reserves, Michael Kalavritinos, managing director BNY Mellon Asset Servicing US officials were concerned that Brazil might “Historically, Brazilians who have invested off- dump them on the market,” Vrljicak says. At shore have looked to the US and Europe, and the time of publishing, Mantega was warning In terms of credit risk, apart from interna- to some extent Asia,” says Kalavritinos. “But against any further quantitative easing mea- tional and local regulators overseeing the given the macroeconomic and political situation sures by the Fed. Brazilian market, Kalavritinos says that of Latin America, the region is in a much more BNY Mellon has the proper risk controls and solid position today than it has been in many compliance procedures in place to mitigate Although BRICS nations (Brazil, Russia, In- years, and we are increasingly seeing interest concerns on creditworthiness. dia, China and South Africa) are engaging with among Latin investors in the their own turf.” Washington on economic cooperation with the “The Brazilian fund market is a daily NAV EU, at the same time the eurozone is still grap- As an example, he points to initiatives like market, it is highly regulated and these are pling with a seemingly never-ending sovereign the stock exchange merger between Chile, not the usual associations made when think- debt crisis and the size and scale of any BRICS- Colombia and Peru, Mercados Integrados ing about hedge funds or alternative invest- led response is in question. Latinoamericanos (Mila), which allows trading ments,” he says. in the stock of all the listed firms from each “As a result of these factors, in the past 12 to individual exchange. The offshore market is the Caribbean domi- 18 months, the Europeans have become more cile, meaning it could be a Luxembourg or absent, the US is not a favoured investment Dublin entity and though Brazilian financial destination, so trade is moving to Asia,” he “Latin American banks are increasing their re- institutions and fund managers have offshore says. “And now, Brazil is getting into the mode search staff and coverage of sectors and of the holdings to invest outside of Brazil, in many of balanced budgets and refusing US dollars, region as a whole. Looking at Chile, the coun- cases the Caribbean offshore market caters which tells you something about the business try has an advanced and sophisticated retail to non-Brazilian residents. sentiment, the business community is quite pro- mutual fund market and there are a number of tectionist and the leadership has started saying mutual funds in Chile that are specific to Latin In general, investors that are domiciled in Brazil that employment is the top priority.” America providing expertise on investment in can tap into the market via local funds that in the region,” Kalavritinos says, adding that this turn invest within certain limits in an offshore ve- trend will likely grow. Still, the central bank in Brazil has turned a cor- hicle for exposure. ner in using policy tools to control the situation. In what is being described as a surprise deci- BNY Mellon, however, is not a bank in the region, “This is still an emerging trend, not a large sion, the central bank lowered the overnight rate operating just its asset servicing business for trend yet, but as the interest rate goes down in 50 basis points to 12 per cent at the beginning Latin and Caribbean clients which are focused Brazil, I think investors will take a closer look,” of September. Meanwhile, inflationary expecta- on servicing cross-border assets, such as fund says Kalavritinos. tions for 2012 are over five per cent and are cur- managers, central and commercial banks and rently above the 4.5 per cent target. pension funds. It has some $160 billion in AUA, “For the asset servicing provider, it is a positive of which about a third is from its Brazilian busi- thing, globally we service over $26 trillion in as- “The central bank lowered the exchange rate by ness which is focused on fund administration, sets, we offer a network of over 100 sub-custo- dropping the interest rate, and it came down a fund accounting and other fiduciary services for dians which is one of the largest networks,” he bit but not much. This first step, however, of low- local investment managers. says, “I think we are appropriately and positively ering the interest rate, is a marked fundamental positioned to service assets that are invested change in the central bank’s way of handling “We have approximately 400 staff on the outside of Brazil and in a number of countries 8 www.assetservicingtimes.com RegionalFocus RegionalFocus

and we are optimistic that we will be well posi- “We are seeing our market share grow. In the six per cent? So although there are avenues to in- tioned as these investors become ready to dip private equity space, we are at the top in terms vest outside of Brazil and these avenues have ex- their toes into the market, whether it is in the of market share, [providing fund administration isted for three years now, we see that investments US, Europe or Asia. We look forward to that in- for] 17 per cent of assets under management. outside of Brazil are minimal,” Berney says. creased diversification of assets.” In terms of FIDICs, which is the name for credit receivable funds, we also have a relatively high In the rest of the region, it is still market practice to keep Although funds are growing within Latin Amer- position in terms of market share. The seg- fund administration in-house. However, Citi has start- ica and trade is growing with Asia, in terms of ments we are looking at most are the private ed providing services for local exchange traded funds safe-keeping of assets, from a global custody equity, credit receivable and hedge fund spaces in Colombia and Mexico. Berney sees the same trend perspective, that is still happening in the US, because they require higher added value ser- which is now booming in Brazil starting in those two though BNY Mellon is looking at how additional vices,” he says. countries as well as Chile and to a lesser extent Peru. resources might be used to allow it to become more locally rooted.

“It is important to be close to the market, close to our clients, to be consistently visible and Brazil has the highest real interest rates in present so that we have the local presence to the world, why invest in Europe at one per understand the idiosyncrasies of each of the markets, the evolving regulatory changes and cent if someone can get a real, risk-free fiscal changes and to be positioned properly so interest rate of six per cent? that we are there when the right opportunities Alejandro Berney, head of securities and fund services, Latin America, arise,” says Kalavritinos, adding that the region Citi Global Transaction Services as a whole is rapidly changing and its needs are becoming more global.

Brazil is home to the third largest derivatives “Asset managers in [those countries] are really “It is an opportune time to be expanding and not exchange in the world and the seventh largest looking at the region, it is a matter of developing contracting,” he adds. fund industry in the world with some one trillion the products, going into complexity and needing dollars in assets under management. The size assistance in terms of know-how and the best and depth of this market has much to do with way to set up a regional fund – a Chilean man- Fund administration boom? the country’s regulatory framework which makes ager launching a new fund in Colombia needs it attractive to use mutual fund structures for a to set up a local fund but doesn’t want to set It’s the microtrends that are most important and wide variety of funds such as private equity and up a whole new office in Colombia. They want not the macroeconomics, says Alejandro Ber- asset backed securities, even trusts – instead of to start as lean as possible and therefore they ney, head of securities and fund services for a separately managed account, portfolio man- outsource the fund administration, the custody Latin America at Citi’s Global Transaction Ser- agers create a dedicated mutual fund. and other services as well,” Berney says. “It is vices. “It is really the growth of the fund man- similar to the Brazil story but a couple of years agement industry that is driving growth in the “There is a long demand history in Brazil for behind in evolution. We are sure it is going the fund administration business,” he says. fund administration because mutual funds are same way though.” created for a many different reasons. Since the Today, Citi Global Transaction Services offers late nineties, it has been common for portfolio fund administration in Brazil, Colombia, Mexico managers or asset managers to hire fund ad- Offshore capacity Cayman Islands, British Virgin Islands, Baha- ministrators, simply for the sheer load of work,” mas, Bermuda and Panama, to fund managers he adds. “What we find is that fund administra- Another trend is emerging as the region gears that specialise in credit, private equity, equity, tion is growing not because funds are trying to up for additional funds flow. Though the Carib- fixed income, hedge funds and ‘multi-merca- reduce their internal costs but rather because bean is not at this time on the radar screen as dos’. In Brazil, it is third in market share for in- they need to grow very quickly and need assis- a potential competitor for the fund administra- dependent asset managers not affiliated with tance both in terms of sheer processing and in tion business, say major transaction services larger banks. terms of intelligence to develop new products.” providers, at the same time, some market participants are seeing an increase of funds Berney notes that the region has a growing mid- Yet, only three years ago pension funds were au- flowing from Brazil to the Cayman Islands and dle class which is increasing its savings. Look- thorised to invest offshore, however, can only do other locations. ing at the pension fund industry, for example, so through a local multi-mercado which allows shows between 12 and 18 per cent growth. up to 20 per cent of assets to be invested off- “We are seeing a lot of flow from Brazil going shore while a plain vanilla equity fund can invest offshore and are seeing firms building capac- only 10 per cent offshore. Funds allowing 100 ity to invest off shore on the Brazilian risk pro- “That is a lot of new money that needs to get per cent offshore investment are restricted to file,” notes Guillaume Weeger, manager and invested, some of it goes to fixed income, but qualified individuals, which tend to be high net market specialist in the Americas for Calypso, some if it is going into alternatives or funds, peo- worth individuals who have more than $200,000 an integrated platform provider. AST ple are trying to find uncorrelated asset classes. in investable assets. Asset managers, meanwhile, sell funds to institutional investors like pension funds or high net Although Citi does provide fund administration worth individuals who are trying to diversify port- services to clients trying to distribute more in folios or increase returns.” Berney says. Brazil to capture some of these flows, the op- Next issue: portunity cost of diversifying is very high for a Some 10 years ago, regional asset managers Brazilian, Berney explains. The Mexican started to become much more sophisticated, using European and American investment “Brazil has the highest real interest rates in the custody market strategies which are now boosted by sufficient, world, why invest in Europe at one per cent if growing savings. someone can get a real, risk-free interest rate of 9 www.assetservicingtimes.com Bottom line: Your securities services expert 2in Central and Eastern Europe @ Our network is available for you in Central and Eastern Europe for your securities services business. We bring you in-depth local experience and award winning international expertise. ING is your partner in Bulgaria, Czech Republic, Hungary, Poland, Romania, Russia, Slovak Republic and Ukraine. For more information call Lilla Juranyi, Global Head of Investor Services on +31 20 563 6435 or e-mail: [email protected]. www.ingcommercialbanking.com

ING Commercial Banking is a marketing name of ING Bank N.V., registered by the Netherlands Authority for the Financial Markets (AFM). Copyright ING Commercial Banking (2010). RiskManagement

Riding the rollercoaster There’s a need to apply a real-time focus to existing risk management practices and consider other risks inherent in financial markets operations, writes Dedication Group’s Greg Pritchard

Bottom line: EXCLUSIVE

The financial media is currently awash with the specialist resource availability to work through act strategies to limit exposures and losses. Re- Your securities services expert news that instead of periods of high volatility large volumes of data, requiring additional over- gardless of volatility levels; these measures are constituting exceptional market conditions; high sight to ensure all checks and balances have stemming the preventable or expected losses in Central and Eastern Europe volatility is becoming the new normal. Thus, been undertaken. Incurring further losses as the inherent in normal trading activity. rather than organisations applying extra atten- time taken to investigate and manage excep- tion and oversight to risk management in the tions, increases. However the combination of higher volatility 2 @ short-term due to volatility spikes, we are start- with fraudulent and unauthorised trading activ- Our network is available for you in Central and Eastern Europe for your securities services ing to see a change in the risk management Traditionally spikes in volatility have forced ity, presents almost insurmountable losses as business. We bring you in-depth local experience and award winning international expertise. paradigm itself. us to: seen in the cases of UBS, Societe Generale, • closely track market risk; undertaking Val- and Barings. In these situations, real-time mar- ING is your partner in Bulgaria, Czech Republic, Hungary, Poland, Romania, Russia, Slovak During periods of lower volatility participants ue-at-Risk (VAR) and other market-shock ket risk management was calculated on what Republic and Ukraine. For more information call Lilla Juranyi, Global Head of Investor Services are able to augment automated market and calculations to establish the sensitivity of was assumed to be the correct position. on +31 20 563 6435 or e-mail: [email protected]. credit risk systems with manual oversight and position valuations from price and rate exceptions-based investigations. However, un- movements In hindsight, utilising market risk calculations on surprising to any head of trading or desk man- • re-mark trades with counterparties to re- fictitious trades runs the risk of creating a false www.ingcommercialbanking.com ager, highly volatile markets mean that the time duce position exposures negative indicator on loss potential. That is, between checking and resolving risk manage- • recalculate capital adequacy to ensure market risk in this instance did not contribute to ment exceptions shortens to daily or intra-day regulatory compliance. identifying sources of loss before they occurred. intervals, thereby making manual investigations These examples show market and counterparty too time intensive. In most organisations, the risk management risk calculations can prove invalid when based teams are effectively applying these techniques, on flawed assumptions in the integrity of the un- ING Commercial Banking is a marketing name of ING Bank N.V., registered by the Netherlands Authority for the Financial Markets (AFM). Copyright ING Commercial Banking (2010). These manual investigations are at the mercy of and more, to identify sources of risk and to en- derlying trades. The learning from this is market 11 www.assetservicingtimes.com RiskManagement risk can be calculated correctly on a fictitious There are many, varied investigative paths, but variables can highlight trade recording errors, position as much as it can be correctly calcu- with each of these the core verification steps re- either accidental or fraudulent - many organi- lated on a valid trading position. main. These include; counterparty confirmation, sations measure these values independently internal funding or external cash settlement, across the finance, treasury and risk functions In a volatile environment the importance of reconciliation, calculation and reporting of P&L. respectively. Measuring these values in organi- timely identification and reporting of operational sational silos misses the opportunity to identify exceptions may mean the difference between In order to bring all risk management functions problems that can only be seen in the context of business survival and ruin. into real-time modelling across the individual other factors. For example, a significantly large risk classes of market, credit, operational and arbitrage position may be generating modest regulatory risk, teams must: P&L, with limited funding, but have VAR mea- Fighting volatility – head on • baseline the trade flows and official po- sures not in-line with expectations. Systemati- sition repositories across the systems’ cally collecting this data, calculating correlations While exceptional events such as fraudulent topology within the trading environ- in real-time and comparing against historical and unauthorised trading, may be generating ment – this will provide a model against trends can allow you to view deviations from negative sentiment for some institutions at pres- which gaps and further sources of risk expected norms and identify risks with positions ent, these system failures provide a useful refer- can be analysed or valuations. ence point for highlighting where risk manage- • identify the areas of risk in the trading envi- ment needs improvement. The tools, systems ronment i.e. manual handling touch points, and measures used to identify and report on gaps in system functionality relative to trad- What the future holds these events are the very structural elements ing sophistication, access to systems and we should be incorporating to responsibly man- controls by users outside of the intended To achieve real-time risk management to cope age risk in trading operations. operating model with volatile markets requires organisational • establish quantitative measures and nor- vision and co-ordination across the firm. There mal operating ranges for each of those are numerous barriers to adopting a success- risk areas ful real-time risk management program; how- • automate collection of the data to support ever the potential for significant loss remains these measures when accurate and timely information is not • algorithmically verify the source data readily available. In a volatile environ- against pre-defined quantitative levels • present the information in a manner con- Some of the barriers faced by organisations include: ment the importance sistent with the reporting levels and fre- • achieving a consistent definition of opera- of timely identification quency of other risk measures tional risk metrics • prove the measurement and reporting • out of date or inflexible systems inhibiting and reporting of op- model at high volumes as well as at access to core data in real-time high volatilities. • not having the expertise to design the erational exceptions required technical and operating topol- To give an example, every OTC deal needs to ogy, and may mean the differ- be independently confirmed with counterpar- • lack of political clout to drive solutions span- ence between busi- ties. The sending or receipt, and acceptance, of ning divisions and lines of responsibility the confirmation needs to be tracked and mea- ness survival and ruin sured centrally with confirmed failures reported By incorporating operational risk factors quan- through the same reporting mechanisms used titatively into established risk management for market and credit risk. Where a trade has processes, and evolving risk management not been confirmed within pre-defined “normal” oversight to an automated, consolidated and timeframes, the risk and desk managers’ dash- real-time model; organisations are better able board should highlight the discrepancy and in- to protect themselves from risk exposures in In raw terms, whatever you’re manually stigate an investigation. highly volatile environments. In the end this is analysing after the fact - you should be do- what will differentiate the firms that will survive ing in real-time, consistently and repeatedly In addition, trades will either require internal from those that will not. AST as part of normal trading operations and funding from the organisation’s central treasury, risk management. and/or be cash settled with external counterparties. These cash movements need to be tied To understand what it would take to systemati- back to every single trade in the ledger. Gen- cally identify and manage these exposures in erally speaking fictitious trades don’t require real-time; we first look at the steps undertaken funding. Therefore, attention should be drawn during a forensic analysis of trading opera- to mismatches between expected, benchmark tions after a significant fraud or unauthorised funding levels and actual funding requirements. trading event: Positions which aren’t actually funded according • every trade (in question) is confirmed with to their theoretical requirements should be red each respective counterparty flags for investigation and followed-up. Often we • cash flows and internal funding is recon- see organisations manage funding at such an ciled against deals aggregate level; that deal-by-deal funding dis- • trade modifications post-booking, espe- crepancies can go unnoticed. cially by front office, are scrutinised • every position feeding into market risk Trading activity should generally show a corre- is re-marked lation between the three variables of; P&L, fund- • every trade is verified as actually feeding ing and VAR. That is, positions with a high P&L into the market risk calculation should carry large funding requirements and/or • trend correlations of P&L, VAR and fund- be exhibiting changes to VAR. While combining

ing requirements. and calculating correlation between the three Greg Pritchard Managing director Dedication Group 12 www.assetservicingtimes.com IndustryTraining Training and Education

13 Oct London UCITS Funds Eureka Financial This practical one day course is designed to provide an insight into the area of UCITS, showing how funds may select eligible assets and demonstrate how these instruments may be employed to achieve different investment objectives.

26-27 Oct London The Repo Market Eureka Financial The repo market is the lubricant that keeps the financial engine running. It serves as the link between the money and capital markets, and is vital to the well functioning of the financial markets. The turmoil in the market over the past two-years has further enhanced the importance of the repo market.

9-10 Nov London International Securities Settlements & Custodial Services Eureka Financial This training program is designed to provide delegates with practical knowledge about the key concepts, systems, processes and procedures in international securities settlement and custodial services as well as operational risks involved. Participants will have a chance to gain skills necessary to facilitate day-to-day transactions and communication processes between all parties involved.

16-17 Nov London Collateral Management Investment Education PLC This course looks at Collateral Management in OTC Derivatives in particular as well as Repos and Securities Lending and Borrowing. Risk identification, control, documentation, types of collateral, gross and net exposure and other practical aspects are covered as well as the conceptual framework and practical problems egg the treatment of corporate actions on a borrowed/lent position.

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13 www.assetservicingtimes.com PeopleMoves Industry appointments

Societe Generale Securities Services (SGSS) banker with over 20 years capital markets ex- has appointed Jean-Louis Bernardo as depu- perience, including nine years in securities ser- ty head of Securities Services and head of busi- vices. Prior to joining Deutsche Bank, he had ness development for SGSS in Russia, where it held senior management roles in international ASSETSERVICINGTIMES operates within Societe Generale group’s sub- organisations including Prudential ICICI Asset sidiary, Rosbank, one of the largest privately Management India and Citibank. AST owned banks in the country. He replaces Ma- thieu Maurier, who became SGSS’ global head Credit Suisse has appointed Michael Molle- Editor: Ben Wilkie of sales and relationship management in Janu- mans Head of AES for Japan. Mollemans will be [email protected] ary this year. responsible for building on the market-leading Tel: +44 (0)20 3006 2710 position AES® (Advanced Execution Services) Based in Moscow, Jean-Louis Bernardo reports has achieved in Japanese electronic trading, Journalist: Anna Reitman locally to Mikhail Bratanov, head of SGSS Rus- and for extending its reputation for innovating [email protected] sia (Rosbank) and to Philippe Huerre, head of with algorithms, crossing engines and smart or- Tel: +44 (0) 20 3006 2888 emerging markets for SGSS, in Paris. He will der routing. Fax: +44 (0) 20 8711 5985 contribute towards developing the offering and growing SGSS’ activities in Russia. Based in Tokyo, Mollemans will report func- Publisher: Justin Lawson tionally to Hani Shalabi, head of AES® for Asia [email protected] SGSS Russia (Rosbank), has had a long-term Pacific, and locally to Martin Keeble, head of Tel: +44 (0)20 8249 2615 commitment to Russia, where it is actively in- equities for Japan. He joins Credit Suisse as Fax: +44 (0)20 8711 5985 volved in the development of the country’s fi- a Director. nancial market infrastructures. Published by Black Knight Media Ltd Mollemans was previously head of electronic 16 Bromley Road Jean-Louis Bernardo has a Masters in Econom- trading sales at Daiwa Capital Markets in New Beckenham ics and a Post-Graduate Degree in Banking Fi- York. He has previous experience in Japan, Kent, BR3 5JE nance and International Trade from Bordeaux having worked in Tokyo for Crédit Lyonnais Se- UK University. He started his career in 1995 with curities between 2000 and 2002 before moving Citibank Capital Markets in Paris, where he oc- to New York. Company reg: 0719464 cupied various positions in Operations. In 2000, Copyright C 2011 Black Knight Media Ltd. he joined SGSS’ global sales and relationship “Michael’s technical skills and experience with All rights reserved. management team as product manager and US clients investing in Japan will be very com- plementary to the strong AES team already on then in 2007 became deputy head and head of Brown joins State Street from Credit Suisse, the ground in Tokyo,” commented Shalabi. “He’s operations of SGSS Spain. From August 2009, where he was director of Americas sales for the ideally positioned to help our clients capitalize Jean-Louis Bernardo managed the implemen- Prime Services division. He will report to Chris- on new technology and market structure chang- tation of a complete securities services plat- topher Holzwarth, senior managing director and es in that fast-evolving market.” form for SGSS in Egypt to cope with the rapid head of global sales for State Street’s Securities expansion of the securities services activity in Keeble added: “Michael will be a valuable addition Finance business. that market. to our growing Equities franchise in Tokyo, where Credit Suisse’s leadership in electronic trading is a “Doug brings a wealth of expertise in agency lend- Mrugank Paranjape, managing director, critical part of our value proposition to clients.” ing, cash management and prime services-related has been appointed head of Direct Securities activities, as well as extensive market contacts Services (DSS) for Asia-Pacific where he has State Street has announced the appointment of and client relationships,” said Holzwarth. overall responsibility for business strategy and Douglas Brown in the role of managing director growth for the bank’s subcustody, clearing, and and sales manager on the Securities Finance Earlier in his career, Brown spent six years at fund administration business across 14 coun- Americas team. Brown is based in Boston and State Street as a senior relationship manager in tries in the region, as well as expanding the responsible for all securities finance sales and Securities Finance and three years with Mellon Bank’s footprint in the onshore fund adminis- new business development efforts for the US, Trust, most recently in a relationship manage- tration space. Mrugank Paranjape is a veteran Canada and Latin America. ment role.

Raising The Bar In Recruitment

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