- Ongoing internal infrastructure and technology investments enable firm to extend cost reductions to clients through efficiencies gained
- Pricing changes designed to incentivize industry best practice in the confirmation, settlement and account instruction (SSI) processes
Omgeo, the global standard for post-trade efficiency, today announced its ongoing commitment to a pricing strategy designed to reduce costs and overall risk in the financial markets by incentivizing industry best practice. Omgeo was able to offer these pricing changes as a direct result of cost efficiencies gained within the firm from ongoing investments in infrastructure and technology.
In recent years, Omgeo has continued to make strategic internal infrastructure and technology investments that have increased efficiencies and reduced costs across Omgeo’s product and technology operations. Examples include retiring legacy infrastructure, leveraging new technologies across Omgeo’s product set and driving down operating costs.
Omgeo has extended these efficiencies to its client community through targeted price adjustments across a number of services. The most recent pricing changes include those related to incenting clients to verify trades on the same day they are executed, known as Same Day Affirmation (SDA), via Omgeo Central Trade ManagerSM (Omgeo CTM) and OASYS-TradeMatchSM. Clients who leverage these services are able to reduce their Omgeo transaction costs by up to 15%. SDA is widely recognized as an industry best practice, as trades verified on T+0 have a much higher chance of settling on time and are less likely to fail, making SDA a key contributor to improved settlement efficiency and an important enabler of shortened settlement cycles.
Other highlights of previous price adjustments include:
- Reductions to its U.S. securities post-trade processing service, Omgeo TradeSuite IDSM, with savings ranging between 20% and 35% including an incentive to affirm trades more quickly
- Reductions to its web-based settlement and account instruction (SSI) database, Omgeo ALERTSM, where 100% data compliance levels are discounted by 5%
Tim Keady, Managing Director of Sales and Solution Delivery at Omgeo, said: “By delivering targeted price reductions, introducing best practice cost incentives and streamlining middle office processes, Omgeo has taken, and continues to take, tangible steps to bring increased efficiency to the global markets at a compelling total cost of ownership. As local markets continue to introduce shorter settlement cycles around the world, we will look to do everything we can to support our clients in this effort.”
To further support the industry’s effort to reduce cost and risk exposure, Omgeo’s past pricing changes were also designed to improve the accuracy of SSIs. Studies show that inaccurate settlement data is often a key reason for trade failures. With Omgeo ALERT, clients can reduce this trade failure risk by enabling them to share accurate SSI that is compliant with market standards automatically worldwide. Omgeo has taken steps to promote improved data accuracy by offering ALERT pricing incentives that reward data quality best behavior.
Tim Keady added: “We continue to incentivize 100% data compliance levels in Omgeo ALERT and are playing an active role in reducing costs and risks in the SSI process. ALERT enables clients to reduce trade failures by sharing accurate settlement and account instructions that are compliant with local market standards worldwide.”
Omgeo recognizes that pricing must reflect ongoing changes in the industry and will continue to focus on ensuring its pricing structures remain aligned with clients’ operating models as well as their use of Omgeo services.
 “Mitigating Operational Risk and Increasing Settlement Efficiency Through Same Day Affirmation (SDA)”, Omgeo, October 2010.