SimCorp, a leading provider of investment management software and services for the global financial services industry, has released SimCorp Dimension version 5.1. Included in the many new and enhanced features and functionality across the enterprise-wide system are: Collateral Inclusion in Credit Risk, for the integration of risk measurement and collateral management; a number of additions to the Compliance Manager function; and support for Phase 1 of the new accounting standard: IFRS 9.
The role of the middle office function of risk management has risen in priority in the wake of the financial crisis and the imminent introduction of a number of new regulatory requirements. One new piece of functionality within version 5.1 that supports this is Collateral Inclusion in Credit Risk. The seamless integration of risk measurement with collateral management enables collateral to be included in counterparty-default stress-testing and simulation. This is an important tool for mitigating market and operational risk; it also supports regulatory compliance monitoring and reporting.
For the front office, a number of enhancements have been included in the Compliance Manager functionality, which supports the current trend for stricter regulations that asset managers need to adhere to whilst employing the advanced and exotic instruments that are often required to handle sophisticated client mandates. Four new modules have been added to the Compliance Manager: Dashboard, Alerts Inbox, Cash Monitoring Rules and Hierarchy Automation.
The Dashboard module instantly identifies compliance issues as they occur; while the Alerts Inbox module enables actions to be taken on post-trade compliance incidents and provides an improved toolbox to address breaches and exceptions. The Cash Monitoring Rules module comes into force at the point of entering a trade and ensures that a firm will have sufficient cash on settlement date. The Hierarchy Automation module allows users to define the level of automation in portfolio hierarchy structures and is particularly relevant to private wealth and asset managers with large numbers of clients.
The introduction of the IFRS 9 Phase 1 module, which fully supports the first part of this new accounting standard, is one of the enhancements to the back office functionality of SimCorp Dimension. In addition, SimCorp is prepared for phases 2 and 3 once these have been finalised by the regulators.
“SimCorp Dimension is well prepared for all the new regulations that are due to come into force within the next year,” says Torben Munch, chief operating officer for SimCorp. “We have anticipated and planned for the most probable regulatory requirements – we just await confirmation of the exact contents from the regulators. Because SimCorp Dimension is a seamless processing system, based on a single core database, and we release new versions of the system twice a year, SimCorp clients can be assured that their investment management solution is kept abreast of the market. This is more important than ever in this year of great regulatory change.”