The SEC, Asset International and Markit Hub also have FinTech news.
Some Firms Still Using Legacy, Error-Prone IT
Nearly one-third of asset managers — based outside of North America — say that they are hanging onto legacy IT platforms even if these systems are causing trade delays and errors, according to a new survey from market research firm TABB Group.
The global, non-North American investment managers reveal in the survey that “trade delays caused by inadequate technology account for opportunity costs of anywhere up to 50% of revenue.”
The bottom line from the TABB Group’s latest research report, “The Buy-side Legacy IT Hangover: Finding the Cure for Alpha, Compliance and Growth,” is that while there are “notable differences between global investment managers and their North American counterparts … there is an overarching universal need to attract assets with an integrated technology approach.”
In addition, “the choices that investment managers make about their IT architecture can impact their success or failure to compete for market share,” according to the market research firm.
Dayle Scher, TABB senior analyst and report author, argues that as investment organizations “pursue new clients and new asset classes, the supporting IT infrastructure must be able to support growth, compliance and scale.”
Scher’s research revealed:
- One third of asset managers outside of North America have adopted a single vendor, single platform technology;
- Almost 20 percent of non-North American buy-side firms “spend more than an hour a day rectifying errors that result from manual processes;”
- Half of investment management firms experience technical problems in executing pre-trade compliance checks, “exposing them to avoidable financial and reputational risks;”
- And the risk of not meeting the needs of both clients and regulators “means loss of assets, potentially incurring large fines and not sustaining profitability and growth.”
“An increasing number of rules and regulations are putting the squeeze on asset managers across the globe to be compliant,” says Scher in a prepared statement. “The main reason for firms missing the mark on pre-trade compliance checks is the lack of integration and consistent data cross systems. In fact, nearly 40% of our survey respondents who had issues with compliance checks cited lack of integration as the cause.”
SEC Proposes BCP Rule for RIAs
The SEC wants registered investment advisers (RIAs) to create written business continuity plans “under the Investment Advisers Act of 1940 (Advisers Act),” according to the SEC.
The SEC is proposing a new rule and amendments “to adopt and implement written business continuity and transition plans reasonably designed to address operational and other risks related to a significant disruption in the investment adviser’s operations,” according to a statement from the SEC. “The proposal would also amend rule 204-2 under the Advisers Act to require SEC registered investment advisers to make and keep all business continuity and transition plans that are currently in effect or at any time within the past five years were in effect.”
The SEC is seeking comment on its proposed rule “on or before September 6, 2016” via the SEC’s comment form at: http://www.sec.gov/rules/proposed.shtml. Comments can also be sent to rule-comments@sec.gov and the Federal eRulemaking Portal (http://www.regulations.gov) provides instructions for submitting comments.
In addition, paper comments can be sent to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549-1090.
“All submissions should refer to File Number S7-13-16,” according to the SEC. “This file number should be included on the subject line if e-mail is used. To help us process and review your comments more efficiently, please use only one method.”
The SEC will post all comments on the Commission’s Internet website (http://www.sec.gov/rules/proposed.shtml). “Comments are also available for website viewing and printing in the Commission’s Public Reference Room, 100 F Street, NE, Washington, DC 20549, on official business days between the hours of 10:00 am and 3:00 pm,” according to the SEC.
Asset International Acquires Market Metrics and Matrix Solutions
Asset International, a business intelligence and analysis provider for asset managers, has closed its acquisition of Market Metrics and Matrix Solutions, officials say. The Market Metrics and Matrix Solutions are data and research firms for advisor-sold investments and insurance worldwide, and they provide strategic consulting and data sets for mutual funds, variable annuities, mortgages and life insurance.
The acquisition helps Asset International broaden its portfolio of proprietary, actionable data, insights and business intelligence, officials say.
The acquisition is also intended to make Asset International a “one-stop shop for data and insights … as well as providing market surveillance solutions and marketing channels for this community,” officials say.
While Asset International’s headquarters are in New York, it has offices in Stamford, CT; Boston; San Francisco; London; Toronto; Munich; and Melbourne. Asset International is backed by Genstar Capital, a private equity firm based in San Francisco, officials say.
Markit Hub to Feature Wall Street Horizon’s Corporate Events Data
Financial information and systems vendor Markit has selected Wall Street Horizon (WSH) to supply corporate events data to Markit Hub, which aggregates research, analysis and news content from global banks, information providers and news agencies.
Markit Hub provides a centralized interface for managing sell-side and independent research, industry content, economic research, company fundamentals and filings, officials say.
Markit Hub customers will gain access to WSH’s corporate events datasets, “providing information to help professionals manage risk, understand price movement, avoid volatility, and generate alpha,” according to Markit officials. Corporate events data is “an increasingly important part of buy-side firms’ toolkits,” according to WSH’s 2016 Corporate Event Research Survey.
“Corporate events can have a significant impact on investment strategy, timing and outcome,” says Bruce Fador, president and CCO of Wall Street Horizon, in a prepared statement.
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