Investment Operations

DTCC’s CTM Debuts New Tri-Party Matching Workflow for Prime Brokers

Buyside Operations

Infrastructure giant DTCC confirmed last week that Societe Generale is the first Prime Broker to leverage CTM’s new automated tri-party trade matching workflow as the industry prepares for the increased focus on global accelerated settlement requirements. CTM’s new capability, said DTCC, streamlines trade communications between Hedge Funds, Prime Brokers and Executing Brokers. Initially launched to support EMEA securities markets, the firm plans to expand access to the new functionally to other markets in the future.

As the global financial services industry prepares globally for increased accelerated settlement initiatives, firms are looking closely at their post-trade processes. Currently, Prime Brokers receive details from Hedge Funds in a multitude of formats and at varying times throughout execution day and sometimes T+1, creating delays to post-trade processing. With CTM’s new tri-party matching capabilities, CTM standardizes and automates Hedge Fund trade file delivery, ensuring trade details are communicated real time, further enabling a no-touch trade processing flow.

According to DTCC literature, the new workflow leverages CTM’s automated central matching functionality and provides Prime Brokers with a golden copy of transaction details when a trade match between a Hedge Fund and an Executing Broker takes place, bringing real-time standardization and automation to the trade allocation process. The workflow:

  • Synchronizes automation of the trade communication to all Prime Brokers
  • Provides automated real-time trade notifications
  • Intelligently identifies Prime Broker recipients via golden source SSI database
  • Increases the use of PSET matching via CTM to mitigate settlement risk
  • Enriches transactions in CTM with ALERT SSIs, providing increased settlement instruction transparency
  • Provides a golden trade copy that has been pre-matched by the Hedge Fund and Executing Broker

“CTM’s tri-party matching workflow provides a much-needed solution in the prime brokerage space that improves post-trade processing workflows,” said Andrew Daponte at Societe Generale. “The service integrates CTM into the Prime Broker environment, which increases efficiency, capacity and the client experience on the platform.”

CTM is DTCC Institutional Trade Processing’s central matching service for cross-border and domestic transactions across multiple asset classes. Today, there are 6,000+ clients in more than 80 countries using CTM to streamline workflows.

“It is exciting to see Societe Generale’s adoption of CTM tri-party workflow capabilities, a critical enabler of accelerating settlement as it automates the communication of golden trade copy to Prime Brokers as soon as a match between the Hedge Fund and Executing Broker takes place within the CTM platform,” said Val Wotton, Managing Director and General Manager of DTCC Institutional Trade Processing. “We look forward to bringing greater automation to Prime Brokers in EMEA and around the world as part of our plan to best support global financial markets, helping the industry prepare for future accelerated settlement initiatives,” added Wotton.