Catena OTC Derivatives Trade Reporting Survey Reveals Apprehension by Market Participants Over Upcoming Changes
11th Oct 2013 - Catena Technologies Pte Ltd today released the results of a market survey on OTC derivatives trade reporting based on responses from participants during an industry event in September 2013. The Catena survey found that 73% of the participants were concerned with implementation timelines. Ninety-one percent of the respondents revealed that data extraction from source system was an overall challenge for readiness, with 45% concerned specifically with the integration of collateral data. Fifty-five percent of respondents cited the implementation of identifier codes like legal entity identifiers (LEI) and unique trade identifiers (UTI) as a concern. Twenty-seven percent of the survey respondents had not yet begun development of compliance systems.
At the event, Catena introduced its TRACE™ line of products and services, aimed at the OTC Derivatives trade reporting market. In the U.S., the Dodd-Frank Act requires OTC Derivatives trades to be reported to a trade repository, and similar regulations have also been proposed recently across Asia Pacific. Implementing trade reporting requires financial institutions to adapt existing organizations, systems, and processes. Compliance deadlines are compelling those institutions to deploy tactical solutions quickly.
"Although the market has made significant progress in the development of regulatory requirements, there is still a significant amount of work required for firms to be compliant. This is especially true for complex product types and where multiple source systems must be integrated," said Dr. Zhang Li, a Managing Consultant in Catena's Trading and Risk practice. "Besides near-term reporting requirements, many financial institutions are grappling with anticipated requirements, such as collateral reporting, as well as global LEI." Catena's TRACE™ solution is designed both to help firms implement immediate reporting requirements as well as to adapt to new requirements as they emerge.
"Engaging with market participants has provided Catena with a unique understanding of the near-term trade reporting landscape," said Aaron Hallmark, COO of Catena. "Beyond immediate tactical reporting obligations, financial institutions are starting to look at the long-term opportunities that consolidated trade data can provide and think about related value-add services. Innovative service offerings, such as using advanced data visualization and new pricing indexes, are emerging regularly and are helping to reshape the OTC derivatives landscape. Catena is committed to provide thought leadership and guidance to customers as this area evolves."
About Catena Technologies Pte Ltd
Catena Technologies Pte Ltd specializes in architecture, design, and delivery of advanced technology solutions for the financial services industry. Based in Singapore, the company has helped customers around the world, including the U.S., U.K., Japan, Hong Kong, Australia, Singapore, and China. Catena Technologies combines in-depth knowledge of the financial markets with expertise implementing cutting-edge solutions.
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