Tech Update: DTCC adopts ISO 15022 for validation service

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DTCC has responded to global interest in its Global Corporate Action (GCA) Validation Service by adopting the ISO 15022 international messaging standard.

 

In addition, several corporate action solutions providers have certified their interoperability with DTCC’s ISO 15022 GCA Validation Service output, including Checkfree, Information Mosaic, Mondas, N Tier, Vermeg, and Xcitek.

 

The GCA Validation Service provides a centralised source of “scrubbed” information about corporate actions, including tender offers, conversions, stock splits, and nearly 100 other types of events for equities and fixed-income instruments traded in Europe, Asia-Pacific and the Americas, anddelivers comprehensive, accurate and timely information, helping to reduce operational losses and optimise front-office trading. It is provided through Global Asset Solutions LLC, a DTCC subsidiary.

 

“The implementation of ISO 15022 addresses the growing interest among financial services firms worldwide for a central source of global corporate action announcements,” said James Femia, DTCC managing director and head of the Global Corporate Action business. “Our service centres in New York, London and Shanghai make the GCA Validation Service the most comprehensive corporate actions resource available in the global marketplace.

 

“Many European and Asian firms use the ISO 15022 messaging format,” said Steven Cotton, DTCC’s GCA European Relationship Manager based in London. “Expanding access to the GCA Validation Service with 15022 will make it easier for any firm – whether a bank, broker, investment manager, hedge fund or insurance company, no matter where they are located – to begin using the GCA Validation Service.  And by partnering with these corporate action solutions providers, we’re striving to give our customers the greatest level of flexibility in how they access the service.”

 

The ISO 15022 format is being offered in addition to DTCC proprietary GCA Validation format, which is currently used by a number of the service’s global customers. “We also offer a real-time Web browser application for GCA Validation, making it easier for both front-office traders and back-office professionals to access GCA announcements from their desktops.”

 

Background notes: The GCA Validation Service created 900,000 announcement records in 2004, its first full year of operation. Close to 30 per cent of these announcements involved securities outside the US. Last year, a custodian verification feature was also added to the service to further improve the quality of information and eliminate customers’ handling of custodian notifications. Today, the GCA Validation Service processes data from more than 80 custodians worldwide.

 

ISO 15022 is a standard format for electronic messages exchanged among securities firms. It was developed by the International Organisation for Standardisation, a network of the national standards institutes of 148 countries, and provides financial services firms worldwide with a common structure for electronic messages, thereby facilitating the automation of and reducing risks associated with securities processing, including corporate actions.

 

Through its subsidiaries, DTCC provides clearance, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities and over-the-counter derivatives. DTCC’s depository also provides custody and asset servicing for more than two million securities issues from the United States and 100 other countries and territories. In addition, DTCC is a leading processor of mutual funds and insurance transactions, linking funds and carriers with their distribution networks. DTCC has operating facilities in multiple locations in the United States and overseas.