Synergies, STP and Islamic finance: Calypso’s holistic approach to servicing the finance function

Clients have named Calypso Technology the market’s top solution for post-trade processing, and given it top marks for STP, Islamic finance, collateral management and more. We explore how Calypso has created new synergies to unite the front, middle and back office

by | May 28, 2021 | Calypso Technology Inc.

Business certainty and market fluidity unleashed havoc on a wide range of unsuspecting banks and corporates in 2020. Unprecedented government restrictions forced organisations across the world to go remote at the drop of a hat, redraw supply chains and adapt to new consumer habits.

As a result, clients have been more reliant on enterprising fintech vendors than ever to help them survive and thrive during a global pandemic.

This year’s bobsguide Rankings 2020 focused on celebrating those fintechs that have gone the extra mile towards development and servicing clients — and for the third year in a row, customers have recognised global provider Calypso Technology as being a breed apart in multiple categories.

Calypso was named the market’s top solution for post-trade processing and inventory management. This directly followed the vendor’s number one ranking for straight-through processing (STP) in the bobsguide Rankings in both 2018 and 2019, as well as an award for the best collateral management solution.

According to Richard Bentley, Calypso’s chief product and engineering officer, this success largely stems from Calypso’s ability to offer unique synergies that connect the dots between various critical operations.

“The real key synergy here is that we actually don’t deliver distinct solutions to address these different areas,” he says.

“Calypso is a single system, and it’s architected around a central data model with tightly integrated business modules — and those modules support liquidity management, collateral accounting and much, much more.”

Calypso’s wide range of modules are designed to leverage and contribute to the system’s single data store. In turn, clients gain a holistic view of their profit and loss (PnL), trade positions and projected risks.

Although its structure sounds relatively technical in terms of architectural distinction, it actually offers clients a fairly simple and comprehensive experience which enables them to consolidate critical business processes and reduce levels of operational risk and total cost of ownership (TCO).

More importantly, Calypso’s integrated, cloud-based solution gives teams an enterprise-wide view of risk in both the front, middle, and back office. Bearing that in mind, it’s hardly surprising Calypso’s customers also ranked the fintech highly in the bobsguide Rankings 2020’s trading system and market risk analytics categories.

“It’s been a natural progression for Calypso to build on the heritage we have in the back and middle office, and then to extend it into the front office,” Bentley says.

“Pre-financial crisis, it was very common to see a great diversity of systems in use in the front office — with different systems being used to price and book trades in different asset classes.”

But since the crisis, there’s been two tectonic shifts in this space. First, there’s been a progression from in-house solutions to vendor solutions. Second, demand has spiked for cross-asset class front office solutions.

That’s because the need for real-time data on positions, liquidity, cash and the risk ladders is mounting across the entire finance function. As a result, Bentley says the historic distinction between front, middle and back office has begun to erode at pace.

Yet beyond those synergies, Calypso has also been recognised for its ability to deliver local capabilities like Islamic finance that enable Calypso to assist clients in maximising their offerings overseas.

“Calypso is very much a global company — but a core strength of Calypso is the ability to support more local firms who operate in specific regions or a single country,” Bentley says.

“If we look at the Middle East, we’ve built a very strong regional organisation which encompasses not only sales and presales professionals, but also our customer delivery teams, with a very deep local knowledge of regional requirements and the engagement models preferred by customs in the region.”

That’s created rich channels of feedback and expertise which is then used to drive product roadmaps and research and development to ensure offerings are fit for purpose within each particular market — whether it’s local regulatory requirements, accounting standards or various conventions.

“When we enter a new region we do it with a long term perspective,” says Bentley.

“We invest for success, and we build teams in the capability to ensure that we can deliver strong successful implementation, strong customer reference and advocacy which will help us then to grow and serve more customers in the region.”

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