The DTCC effort stresses more automation for the sourcing of corporate actions announcement data.
DTCC officials have just announced that they are forging ahead with a two-phased pilot program to bring more automation to corporate actions (CA) processing.
The effort is intended to deliver “new efficiencies and capabilities that address decades-long asset services challenges around the sourcing of corporate actions announcements,” according to the DTCC.
“The pilot, which includes two phases, aims to streamline interactions across the agent and issuer community by standardizing and automating the sourcing of corporate actions announcements, eliminating manual processes, providing cost savings, reducing processing lead time and mitigating risks,” according to the DTCC.
The first phase of the pilot took place in December 2023 and “tested new inbound automated messaging for issuers and agents. … DTCC provided messaging capabilities modeled on the ISO 20022 standard that enabled an agent to submit an automated announcement to DTCC,” officials add. The DTCC then automated the processing of that announcement via its system and generated an ISO 20022 corporate actions announcement to its client in a test environment.
“The messaging solution removes current manual processes and caters to agents with large event volumes or those looking to send events with large numbers of assets or event notifications,” according to the DTCC.
DTCC officials say they have plans to launch Phase 2 “with a scheduled test release in Q3 2024. In this phase, firms will test a modernized corporate actions GUI portal. The new portal will provide an easy-to-use interface for redemption event types, such as partial/full calls and maturities, which Agents and Issuers can use to transmit accurate and complete announcement event information.”
The goal is to offer agents and issuers “the ability to transmit standardized event information via a modernized interface, increasing accuracy, removing manual validation processes, and eliminating delays to the industry,” officials add.
The pilot follows the DTCC’s publication of an opinion paper, “Automating the Sourcing of Corporate Actions Announcements from Agents and Issuers,” that found “almost half (46 percent) of corporate action global event data is still published and received manually, according to data from SIFMA’s Operations & Technology Committee and Ernst & Young,” according to the DTCC.
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