Northern Trust has become one of the first asset servicers to adopt the Financial Product Mark-up Language (“FpML”) messaging format in processing over the counter (“OTC”) derivative trades. As part of Northern Trust’s move towards increasing automation and straight through processing (“STP”) in OTC derivative trade processing, this format can be used for Northern Trust’s clients across the globe.
FpML is a messaging format which automates the flow of information between an asset servicer like Northern Trust and its clients and operates independently of any underlying software or hardware infrastructure pertaining to derivative trades.
“The format enables us to accept and deliver new trade messages electronically and in a standard, replicated way,” explains Stephen Andress, global head of derivatives processing at Northern Trust. “This increases automation and means that we can process trades faster and with increased accuracy.”
Northern Trust is able to use the FpML standard for all its clients – asset managers and asset owners – requiring OTC trade capture, and has already implemented the system for a high-profile investment manager client.
Andress: “We are investing for the long-term in both people and technology in this area of our business, and are actively pursuing ways to reduce manual processing and facilitate STP. This new messaging format is just one of the initiatives we have implemented in our move towards delivering a fully automated solution to our clients."