Arcontech’s CityVision StarNet platform is a global, real-time market data platform that addresses the need for a rapid response to change faced by all significant consumers, providers and intermediaries of time-sensitive market data. StarNet extends CityVision RTP (Real-time Publisher) to wide area and global IP internetworks. It enhances globalised management, security and bandwidth efficiency and adds features for web server and browser integration. The platform was selected for its plug-and-play applications, and also its ability to enable remote installation and configuration of the RTP hub over the internet.
Highly commended: EBS
EBS®™ Live is a direct, real-time feed, delivering a range of transactional data required by trading communities for accurate and timely pricing and decision-making. With a consistent average speed of under 200 milliseconds, EBS Live minimises market exposure and risk associated with latency. It directly addresses the issues of data consistency and latency reduction, by delivering feeds direct to the customer’s organisation.
Technology to the Buy-side
Winner: EMXCo
The EMX Message System was recognised for its disruptive potential to the embedded manual processes traditionally used to transact collective investments. The EMX Message System provides an electronic connection between fund managers and intermediaries, enabling one data set, generated at the outset, to be used throughout the lifecycle of the trade from placement to settlement, without ever being re-keyed.
The EMX Message System enables its users to buy, sell, value and initiate settlement for all mutual fund transactions electronically, with one set of data from placing the trade, to settlement via an STP fix hub connection, with a full automatic audit trail.
Front Office Trading Solution
Winner: Application Networks
Application Networks’ JRisk software is a clear demonstration of technology used innovatively to address a business problem. JRisk offers a flexible solution as banks increasingly trade more complex assets/asset mixes and require the processing speed necessary to react to investor demands and risk manage the largest portfolios. Pricing, trade capture, risk and processing functionality is provided across all financial assets from equity, foreign exchange and fixed income to credit and interest rate derivatives. Cash and derivative instruments are supported across the board from flow to structured products. An event-based infrastructure provides real-time risk and profit & loss analysis and trade processing.
A strong list of clients acquired over the past 12 months testifies to the estimated average reported return of three to five times the amount invested.
Back Office Solution
The judges were disappointed with the small number of entries for this category and felt that this showed that the back office is an area in which banks have chronically under-invested. As a result, there has been little innovation in back-office systems. It was suggested that this and little knowledge of legacy back-office infrastructure may be two factors driving business process outsourcing to India and other offshore locations.
Winner: Calypso Technology
Calypso was again this year selected as the winner in this category as it demonstrated the only real innovation in the area of back-office processing systems. Calypso addresses the industry’s need to grow earnings through efficiency and expense reduction. It provides trade entry, trade capture, trade enrichment, document generation, rate fixing, settlement, accounting and reporting functionality. Calypso’s strength in the back office is from the breadth and depth of functionality and its modern, flexible technology platform. Built from inception to be cross-asset, it is built 100% in Java with several hundred open APIs, allowing customers to customise the system easily and quickly.
Calypso Back Office offers a single integrated office system, automation of manual processes using rule-based workflow processes, real-time, exceptions-based, workflow-driven, multi-entity, multi-currency, multi-time zone processing. Compatible with all platforms, it also enables grid computing among multiple machines.
Risk Management
Winner: Wipro Technologies
The judges were impressed with the solution’s focus on addressing the topical business issues of the need to improve ROI by improving management of operational risk, and the need to comply with Basel II regulations. Wipro Technologies shows a comprehensive understanding of, and approach to addressing, their client’s (JPMorganChase) business issues.
Mr Joe Sabatini, managing director and the global head of operational risk at JPMorganChase said, “Our overall objective was to design and implement an integrated and cost-effective tool for operational risk which is responsive to business needs, improves our management of risk, enhances our reporting capabilities and helps us meet regulatory requirements. We are reaching that goal through this project.”
The judges felt this project demonstrates a business process oriented solution that has been designed in collaboration with the client. Also, the use of both onsite/offshore development and maintenance teams was considered an innovative approach to enabling cost-effective 24/7 development and support to deliver the solution within schedule.
Designed to be available enterprise-wide and on a global basis, the system has been developed to allow the capture and analysis of operational loss data by any employee, and is capable of easy integration with other risk management tools and the firm’s economic capital engine and combines these to enable sophisticated reporting capabilities for analytics surrounding loss data.
Highly commended: Algorithmics
As the only scalable enterprise suite of integrated risk management solutions to measure and manage market, credit, asset liability and operational risk, Algo Suite was highly commended as the most comprehensive and proven solution, with continuing investment in improvements.
The latest version of Algo Suite, 4.4, leverages Algorithmics’ Mark-to-Future (MtF) technology to provide cost-effective, on-time enterprise risk management. It is the first-ever release of Algo Suite that addresses Basel II compliance and delivers Linux and distributed computing support. Key features include: a framework to marshall data as well as compute and reconcile economic and regulatory capital; the ability to assess the impact of new deals on a portfolio’s risk profile, while considering the effects of natural market offsets and other credit mitigation techniques; real-time limits enabling faster, high-volume pre-deal checking and approvals; and data maintenance tools that can correct subsets of the enterprise calculation without recreating the entire MtF cube.
Treasury
Winner: FNX
FNX’s Sierra Treasury was recognised for impressive results at Bank of Ayudhya, Thailand, which used the solution to significantly improve its trade processing time and costs, and move from five back-office users supporting one trader to one back-office user supporting three traders. The web-based delivery model used at Taipei Bank in Taiwan to improve treasury management was also considered innovative. Judges felt Sierra Treasury is a good product, highly suited to the needs of the Asia-Pacific region, given its focus on developing extra functionality to support additional financial instruments, especially in emerging markets. Sierra Treasury features include a comprehensive cross-product portfolio management system that offers consolidated views; a user configurable, real-time blotter functionality for customised views based on any combination of variables including desk, counterparty, product, currency or time bucket; views that can be saved and shared between different users; gap and cash flow analysis and on and off balance sheet instrument coverage.
Highly Commended: City Networks
CityNet Conversation Checker addresses the problem of manual checking of dealing conversations and reconciling these with the transactions within banks’ front and back-office systems. It automates the conversation reconciliation process for Reuters and EBS dealing systems and eliminates the manual effort, reducing operational risk. It uses a simple status screen that allows exceptions and investigations to be monitored through to resolution. Implementing Conversation Checker at a major European bank to validate the 700 conversations it received daily from Reuters servers has contributed to an 85% STP success rate across the board. Conversation Checker also enabled the bank to centralise its conversation processing procedure, reducing operational risk brought about through missed trades. The client says in the first week of implementation, more than $10,000 was saved on one trade alone that the system picked up having been missed by both alternative processes at the bank.
Trade Finance
While the judges felt that there was still scope for innovation in the area of trade finance, the technologies below were selected as they seem to be evolving in the right direction.
Winner: NEOMALogic
NEOMALogic’s Global Trade Portal is an electronic banking trade finance solution for banks that want to offer corporate customers a full-featured, internet-based console to manage online letters of credit, documentary collections, financing, guarantees and their underlying documentation (document preparation, eUCP). Global Trade Portal provides a single point of interaction for banks and their corporate customers and is personalised to each user’s needs and responsibilities. Customers can use the Global Trade Portal to prepare key trade documents electronically in an intuitive, web-based interface and present them to their bank in compliance with the recent eUCP supplement of the International Chamber of Commerce.
Highly commended: CGI Group Inc
The AMS Trade Portal is innovative due to its availability as an ASP offering, enabling a bank to focus on its trade finance expertise, and its customer service offerings. Costs are shared across multiple banks, which allows access to the technology at lower cost and lower risk than if developing and implementing a front-end system internally. The AMS Trade Portal, a self-service solution, offers the opportunity to replace stand-alone trade services software and manual/hard-copy processes. It streamlines the trade finance initiation process and provides customers with real-time transaction inquiry, mail messaging and advanced reporting capabilities. The portal supports multi-bank, multi-currency, multi-lingual and multi-timezone processing, and is available on a 24/7 basis. The corporate customer can receive images of correspondence from the bank as well as images of documents presented for payment, without having to download additional software.
Cash Management
Winner: Fundtech
Fundtech’s effort to renew traditional systems with a totally new, platform-independent cash management system was commended. Designed to help banks increase customer acquisition and retention to multiple market segments, the key differentiator of CASHplus is the uCustomize technology, which enables a bank to work with a cash management tool that can be tailored to different versions to target different market segments. A key feature is self-service, whereby corporate customers can perform many of the functions themselves for greater efficiency. A platform-independent solution based on open standards architecture, it can be implemented in-house and across an ASP environment.
The product enhances operating efficiencies by eliminating multiple legacy systems and consolidating cash management systems onto a single platform. Its web-based services eliminate software costs and customer self-service functions reduce administration expense. Also notable were the returns on investment and benefits observed by client organisations. Colorado Bank reduced operating expenses by 25%, National Commerce Financial Corporation reduced it by 35% and Cooperative Bank has grown the business by 25% without adding staff.
Highly commended: ABN AMRO
ABN AMRO’s CLS Third Party Offering streamlines and automates clients’ back office FX operations. ABN AMRO recognises CLS as a major part of its clearing business, shown by the bank’s level of investment. One innovative solution it has developed for its clients is the ability to access the service via DirectLink, a cheap and efficient alternative to SWIFT.
This not only comes ahead of time with respect to the incoming industry moves towards the suppression of the MT300 message but also provides a communication method that banks can use to accommodate a variety of formats, including those generated by their corporate counterparties. This approach offers a real solution to the incorporation of the “buy side” in CLS,without the introduction of double processing.
ABN AMRO is also aware of its clients concerns regarding costs and time of the CLS implementation. It created CLS FastTrack to allow clients to go fully live with CLS within just 6 weeks, with no investment costs.
John Gibbons, managing director, Working Capital Cash Flow Advisory at ABN AMRO says: “CLS is a technology that can deliver immense benefits to a wide range of organisations. ABN AMRO’s position as the market leader in CLS has been achieved by through developing a flexible product that can be tailored to differing client requirements and implemented quickly.”
Compliance
Winner: Comit Gruppe
Comit Gruppe’s SWORD is a web-based solution for operational risk management, internal audit and corporate governance. It addresses operational risk within the compliance framework and enables an organisation to have all of its staff involved in the risk management process and to facilitate dissemination of risk management best practice throughout the organisation. SWORD can be implemented in any type or size of organisation. It is developed using Microsoft’s .NET software development environment. With no client-side installation of software, it offers easy roll out to a distributed user base.
SWORD provides a company’s board, and specifically the audit committee, with a clear set of reports that detail current operational risks in the business and the state of any actions to mitigate them. The system allows a business to record all of the required processes, the potential risks if these processes are not adhered to and the controls in place to ensure that they have been correctly carried out. Uncontrolled risks and losses above a certain tolerance are identified to senior management for their attention and again these may be actioned for closure.
SWORD enables staff to be constantly updated on the status of risk and open issues in their areas of responsibility and to be involved in the risk management process from the assessment of risks and controls to the management of issues and the recording of actual losses. It also provides a platform for dissemination of the risk management framework and practices within the organisation, thus ensuring all staff are risk-aware.
Straight-Through Processing
Winner: TradeWeb Europe
TradeWeb was a clear winner in this highly competitive sector and was selected for its introduction of STP to the fixed-income markets, taking a fixed-income trade electronically, and without manual intervention, from inception, through execution, allocation and confirmation. Also applauded was the ability to view trade status in real time, allowing resolution of trading errors within minutes (rather than hours or days).
TradeWeb allows both buy-side and sell-side to execute fixed-income trades electronically. Using FIX or XML interfaces, the buy-side can process these trades electronically without having to re-key execution details into their order management systems. The TradeXpress solution offers the ability to allocate electronically, eliminating the need to use fax, phone or e-mail. This allows accurate post-trade processing and the ability to allocate trades (through TradeXpress) and enrich them with full standing settlement instructions (via AccountNet) providing real-time confirmation. TradeXpress is a thin client application designed for mid- and back-office operations. Once installed, customers connect via the internet to a resilient client server application. AccountNet is a true web-based program that needs no software installation.
Utilising AccountNet, the buy and sell-side can enrich these allocations with complete and accurate standing settlement instructions. The trade process is completed with the sell-side providing a confirmation to the buy-side.
Reference Data
Winner: Cicada
Cicada’s solution provides a complete infrastructure for acquiring, maintaining, integrating and distributing reference data for risk management, compliance, portfolio valuation and other applications throughout an institution. The solution, comprising the Cicada Composer plus+ platform and optional outsourced data management service, addresses financial institutions’ need for complete, clean and accurate reference information on financial instruments, issuers and customers. The technology and services handle all reference data types, including security and counterparty data, and supports both outsourced and in-house data management operations. (For institutions looking to outsource data management tasks, Cicada also provides the exception handling and support services of its professional data quality management group.)
The software’s data architecture enables the institution to managed the difference between source data definitions and target application definitions – the greatest source of processing errors in the securities industry and in risk management.
Reliable information is essential in driving various internal applications and to maintain a current, correct view of market and credit risks. In addition, regulatory and compliance requirements are demanding accurate security and counterparty reference information. The judges were impressed with the combined use of both innovative technology and managed services to help address an increasing problem.
