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Matthew Stauffer, DTCC

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DTCC launches DTCC Exception Manager

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The Depository Trust & Clearing Corporation (DTCC) has launched DTCC Exception Manager, the latest addition to its Institutional Trade Processing product suite.

DTCC Exception Manager enables market participants to publish, manage and communicate exceptions throughout the trade lifecycle, and supports all securities transactions globally.
 
DTCC Exception Manager solves a major challenge for financial firms by establishing a central online industry platform that provides a single view of all post-trade exceptions, analytics to help identify the root cause of operational breaks and the ability to solve problems at the source, such as incorrect standing settlement instructions (SSIs). The service also provides a configurable risk dashboard to measure and chart exceptions based on risk criteria with drill-down capabilities and customisable views, as well as efficient work assignment and collaboration capabilities, enabling timely resolution between trade support and pre-settlement groups with secure communications functionality, audit trails and reports.
 
In a recent survey 78 per cent of respondents pointed to missing or incomplete SSIs as the biggest pain point affecting post-trade processes while 80 per cent felt that faster resolution of exceptions is a key factor in a T+2 settlement cycle environment. DTCC developed the exception and workflow management service at the request of client feedback for an industry platform to aggregate and better manage these events across multiple parties. Policy-makers and regulators are increasingly focused on improving settlement efficiency. It is estimated that a global failure rate of 2 per cent translates into costs and losses up to USD3 billion. In Europe, the CSD Regulation contains provisions within its Settlement Discipline Regime to impose financial penalties and mandate automatic buy-in procedures to address this issue.
 
“Post-trade exception processing often creates operational risk and a significant amount of inefficiency for all parties to a trade,” says Matthew Stauffer (pictured), Managing Director and Head of Institutional Trade Processing at DTCC. “Trade data needs to be consumed and processed from many disparate systems, including matching engines, trading counterparties, settlement entities and market infrastructure providers – and the related communications, which are predominantly emails, are overwhelming, cumbersome to manage and introduce risk.”
 
DTCC Exception Manager was created for all parties involved in the trade lifecycle, including buy-side firms, outsourcers, broker/dealers, custodians, prime brokers, clearing brokers and other settlement agents. Stauffer adds: “It centralises and standardises exception processing to enable faster resolution, delivers a significant reduction in the number of exceptions and supports exceptions in trade validation and settlement processing.”

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