Broadridge Financial Solutions, Inc. (NYSE:BR) today announced the launch of its unique international Affiliate Matching & Settlement solution. The solution, which utilises the same technology as Broadridgeâs leading international trade processing and settlement solution, Gloss, enables firms to clear and settle cross-border trades within their own organisationâs infrastructure allowing firms to significantly increase the operational efficiency of their cross-border flows, consolidate their agent bank or CSD relationships, and reduce their settlement and messaging costs per trade.
In order to help clients understand the concept, and in conjunction with global business and technology consulting firm Investance, Broadridge has produced a white paper entitled âCleared for Globalisation â Time to Rationalise with Affiliate Matching & Settlementâ, which looks at how firms can centralise settlement and clearing as cross-border processing volumes for securities and other asset classes continue to increase. It is particularly targeted at firms looking to rationalise existing complex cross-border trade flows, or for firms which are looking for lower-cost entry options into growth markets such as Asia.
Available now, and live with two clients, the platform removes the need for firms to have their own settlement mechanism in every market, reducing counterparty, custodial and operational risk, and the costs associated with cross-border flows as well as boosting efficiencies. One client is a top-tier Japanese firm which has implemented the solution to allow investors outside of Japan access to the Japanese equities market. The second, a large US institution, has this year implemented the solution for cross-border affiliate clearing in London, in order to facilitate its Asian expansion plans.
Implementation of these solutions can take as little as two months. Available as a hosted solution or onsite, it gives firms control of their cross-border processing and enables the consolidation of external agent bank relationships and accounts. A reduction of custodial relationships also helps to minimise risk exposure, and users can also expect to see a sizeable reduction in network management overheads and external messaging fees. The Affiliate Matching & Settlement solution can be implemented alongside a firmâs existing back office solution or as part of Broadridgeâs industry-leading settlement solution which, in conjunction with the Affiliate Matching & Settlement solution, delivers the highest levels in operational efficiency and timely processing.
âThe launch of our international Affiliate Matching & Settlement solution is part of the Broadridge strategy to continue increasing our global reach. We are already seeing a lot of interest from banks and brokers with two clients live on the solution today,â said Robin Kneale, Head of Strategy & Product Management, Securities Processing Solutions International, Broadridge. âAs demand for international portfolios grows, affiliate matching and settlement has the potential to overcome the inefficiencies associated with the traditional multi-entity approach. Our technology solution offers firms a centralised, rational matching and settlement model and an ability to enter new markets quickly to compete in the growing cross-border arena,â Dr. Kneale added.
Jonathan Purchase, Senior Manager at Investance, said: âA key finding of this study is that significant savings can be made in equity and fixed income cross-border post-trade processing at most investment banks. Centralising clearing and settlement by adopting affiliate matching and settlement provides a cost-effective and scalable solution that will also address the expected future growth in volume from existing clients and expansion into new markets. This is definitely an option that should be on the agenda when considering post-trade strategies at international institutions.â