Thompson Financial ESG, the financial information group, has beefed up ITM, its global straight through processing system, by teaming up with Chase Manhattan and launching four information services for clients by the first quarter of 2001.
Thompson and Chase are to launch a settlement date calculator and a service providing market fees and taxes by the end of this year on a reference only basis so clients can get used to the system. Chase market reports and SSMPAs (settlement system market practice assessments) are launching by next April.
There are key pieces of data required to settle a trade-fees, taxes and settlement details for example and the services automate such data which will add to its information management solutions, an integral part of its ITM. Thompson and its partner the DTCC, America’s Depository Trust & Clearing Corporation, is developing a central matching system in addition to existing ETC services to provide more efficient trade processing.
Kevin Milne, managing director of Thompson ESG in Europe says data provisions are vital. ESG’s trade management solution is two years into its development and Thompson has discovered that although central matching is faster than ETC, it’s essential to support it with accurate and comprehensive data. “We want more settled trades and less fails in an appropriate time. It’s accuracy and integrity first, speed later. The idea is that we isolate that data so the only thing you are doing between trade time and settlement time is agreeing and matching the variable data, the things that do change,” he says.
The new information will enhance Alert, Thompson’s database with fund, settlement and broker delivery instructions. Thompson is considering the introduction of corporate actions data and commissions calculators.
The move is the latest development in the quest for STP. The Global Straight Through Processing Association (GSTPA) recently raised over E100m to develop its own system which is essentially identical to Thompson’s ITM. Both parties stress they will work together to achieve interoperability but at a recent conference in America Tom Perna of the Bank of New York said the industry had embarrassed itself by allowing both systems to develop thereby subjecting itself to twice the expense.
If a fund manager goes the GSTPA route, then the associated brokers, counterparties and banks are obliged to build an interface and support that process as well. “Unless true interoperability can be achieved between our respective services, the industry will need to maintain and support interfaces and connections to two services rather than one,” says Milne.

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