SunGard Predicts New Post-Trade Challenges Will Demand Consolidated, Real-time Information
Tony Scianna, executive vice president of SunGard’s brokerage and clearance business, says, “Greater emphasis on counterparty and asset exposure is driving the need for financial institutions to adopt a new consolidated, real-time model for credit monitoring across business lines and asset classes, regardless of applications and technology used.”
SunGard says that as taxpayers and governments around the world fund the effort to control the global financial crisis, regulators will demand faster and more reliable oversight and accountability. SunGard recommends financial institutions meet these new challenges through consolidated, real-time information management and workflows to achieve a holistic view of risk and exposure.
SunGard recommends three ways that financial institutions can use consolidated information to understand their exposure and be prepared to meet upcoming regulatory changes:
1. Gain a complete company-wide view of exposure to a particular asset class, industry, company or country;
2. Monitor credit and collateral to determine exposures to or with any given client or counterparty in real-time; and
3. Support new regulatory mandates requiring consolidated information across business lines and asset classes.
Key Challenges
• Financial institutions need to reduce credit risk while extending additional credit
• Using separate asset-specific collateral, credit and lending systems leads to duplication of collateral allocated to loans or lines of credit
• Increasing amounts and uses of data are required to feed credit monitoring and regulatory requirements
• The lack of collateral valuation monitoring and visibility is causing time-consuming and costly operational issues
Guillermo Kopp, executive director and global research fellow at TowerGroup, says: “We’ll see a more integrated approach emerging in terms of regulations going forward, that will look for institutions to have consistency of implementation to address critical aspects that no one institution can pin down.”
David Eldon, chairman of the board of the Dubai International Financial Centre Authority, says “I see a greater appetite for amalgamations as banks try to strengthen their capital basis, and as they try to get more efficiencies out of their legacy systems.”
Nicholas Rubino, executive vice president and chief operations officer at Daiwa Securities America, says, “SunGard provides a single application for multiple asset classes that shows our total cross-product, cross-counterparty exposure in one place. This has had a direct, positive effect on Daiwa’s bottom line and viability in an unpredictable market, helping to make us immediately aware of exposures.”
Anthony Katsingris, chief operating officer at Albert Fried & Company, says, “SunGard helps us gain the efficiencies required to evolve our business, with the ability to plug-and-play its broad portfolio of financial services solutions as new capabilities are needed.”
