Investment Operations

DTCC Partners with Growing Global Custodian Community on Exception Management

Majority of the world’s top Global Custodians are now providing settlement data directly into Exception Manager

The Depository Trust & Clearing Corporation (DTCC) said today that its Exception Manager global custodian community has grown to a total of 11, including BNY Mellon, Brown Brothers Harriman and Co., Caceis, CIBC Mellon, Citi, HSBC, JP Morgan, Northern Trust, RBC Investor & Treasury Services and State Street. The global custodians directly submit exception data to Exception Manager, which the depository says allows the timeliness, completeness and accuracy of information critical for underlying clients to rapidly resolve settlement exceptions.

“By partnering with DTCC to submit exception data directly into the Exception Manager platform, we are able to provide our clients with centralized access to accurate data and help prepare for CSDR by greatly reducing risk and quickly resolving exceptions,” said Dominic Crowe, North America Head of Custody and Fund Services at Citi.

DTCC has also recently introduced a new proprietary data feed into the Exception Manager platform that integrates DTCC TradeSuite ID affirmed confirm data, and the associated DTC Inventory Management System (IMS) settlement status data. Exception Manager users will be able to identify any settlement exceptions with these trades occurring at DTC.

According to DTCC literature, the Exception Manager service was launched to provide a central industry platform to publish, manage, and communicate exceptions throughout the trade settlement lifecycle process, and supports all securities transactions globally, standardizing exception processing to enable faster issue resolution, reducing risk and cost in the settlement process. Industry watchers say this will become increasingly important as new regulations, such as the Central Securities Depositories Regulation (CSDR) which aims to increase the safety and efficiency of securities settlement and the settlement infrastructures in the EU, take effect.

DTCC said that, by leveraging the full suite of DTCC’s Institutional Trade Processing (ITP) solutions, firms are well-positioned to comply with CSDR mandates through a no-touch workflow that increases affirmation rates, helps to prevent settlement fails, and allows them to manage their exceptions in the Exception Manager platform when they do occur.

“The growth in the adoption of Exception Manager, particularly with the top global custodians, is an important step in moving the industry forward, in preparation for the upcoming CSDR mandate,” said Matthew Stauffer, Managing Director and Head of Institutional Trade Processing at DTCC. “As settlement fails will soon result in penalties and mandatory buy-ins under the Settlement Discipline Regime, quickly capturing, assessing and resolving exceptions is critical.”