Princeton, NJ (August 23, 2001) -- ABP Investments US Inc., the U.S. subsidiary of Netherlands-based Stichting Pensioenfonds ABP, one of the three largest pension funds in the world, has implemented the newly released Electronic Pool Notification (EPN) Interface from Princeton Financial Systems. The automated message-based interface enables ABP to efficiently achieve straight through processing of TBA (To Be Announced) mortgage-backed securities using Princeton Financial's PAM® portfolio management software.
Princeton Financial delivered the interface functionality with development assistance from NewtonPartners Inc. of Sacramento, CA, and client input from ABP US. The EPN Interface enables clients to achieve straight through processing (STP) of mortgage-backed security trade allocations through MBS Clearing Corp.'s Electronic Pool Notification (EPN) System. EPN is an electronic communication network that allows participants to transmit and retrieve mortgage-backed security pool information via standardized message formats. Before creating PAM messages to process transactions, the EPN Interface automates the processing of TBA allocations and identifies corresponding TBA transactions in PAM. It also determines if the mortgage-backed security pool is already set up. If it is not set up, the EPN Interface leverages PAM's BloombergÒ Data License interface to pull in the pool and factor data as needed to process the allocations.
The EPN Interface provides an array of reports and audit trails, allowing for timely, accurate and rapid delivery of messages. Because of these benefits, clients can significantly reduce their processing time and the number of errors that they experienced previously with manual methods of exchanging pool information. In turn, the streamlined operations provide the capacity to handle high-volume automatic settlement of MBS TBA trades.
Prior to implementing the EPN Interface, ABP processed TBA pool allocations manually. By automating the process through the EPN Interface, ABP reduced its processing by 75 percent. "For several years, the industry has needed improvement in the settlement area of mortgage-backed securities TBA pool allocations," said Jeanine Presa, Senior Vice President of Operations for ABP US. "The EPN Interface has significantly reduced our processing time and increased our capacity to handle more volume. It adds controls to our workflow and enables timely settlement between our custodian, State Street, and our brokers. Now our company is closer to STP solutions before 2002 and our business has increased capacity to handle growth and change in our future."
"Princeton Financial believes the mortgage-backed securities market will continue to grow in importance, requiring us to provide our clients with sophisticated systems that help them capture opportunities," said Princeton Financial's Chief Operating Officer, Scott Ferrante. "Because the EPN Interface enables our clients to easily achieve straight through processing, we are making it possible for them to improve their operations while keeping their focus where it should be: the market."