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European Market Infrastructure Regulation.

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The Over-The-Counter (OTC) derivatives market is unregulated and builds risks within the financial services industry. To control this, EMIR (European Market Infrastructure Regulation) has introduced new requirements that minimizes risks. This requires all standardized OTC derivatives to be cleared through Clearing Counter Parties. EMIR also contains provisions related to the confirmation process, collateral mechanisms, independent valuation and reporting of OTC transactions to trade repositories.

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European Market Infrastructure Regulation.

  1. 1. European Market Infrastructure Regulation (EMIR)The Over-The-Counter (OTC) derivatives market is unregulated and builds risks within thefinancial services industry. To control this, EMIR (European Market Infrastructure Regulation)has introduced new requirements that minimizes risks. This requires all standardized OTCderivatives to be cleared through Clearing Counter Parties. EMIR also contains provisions relatedto the confirmation process, collateral mechanisms, independent valuation and reporting of OTCtransactions to trade repositories.Challenges faced by market participants Interpreting regulations for business and technical requirements Business need Connectivity between market participants and financial market utilities  Systemic risk management Interfacing with Trade Repositories (TRs) to meet reporting obligations  Improvement in governance for banks, large broker dealers and services providers, for publishing trade processes, access to information details, confirmation and risk and collateral information and the ability to act in a timely Implementing FpML and SWIFT message protocol for conducting and sharing and appropriate fashion derivatives trading and message transformation into a standard format  An effective market and Difficulty in reporting trades to the trade repository and identifying clearing trade practice surveillance related data, risk and lifecycle events with time value and format bound process / system business rules (including multiple identifiers relates to legal entities, trades  A data aggregator to gather and products) data from disparate sources in Record-keeping and data reporting requirements (including an audit trail and the enterprise to meet daily as well as historical trading records) on all OTC derivatives reporting obligations Acquiring data from disparate sources and identifying data fields for real-time  Creation of trade data or regulatory streams repository for real time regulatory data reportingMindtree servicesIn order to combat said challenges, Mindtree’s capital market Centre of Excellence  Business impact analysis(CoE) has been at the forefront of tracking development in EMIR. We work  End-to-end solution implementationclosely with our customers in monitoring changes and developing solutions that  Technology integrationcomply with regulatory and reporting requirements. We have strong capabilities  Reference data managementin building and interfacing with TR for banks, other market participants  Trade message submissionandservice providers and Application Programming Interface (API) for market  Data warehousing and archivingparticipants to connect to financial market utilities.  Real time reporting  Analytics to mine business drivers and values
  2. 2. OTC trade reporting solution for market participants Multi-asset class support (equity / credit / interest rate / currency / comodity) Reference data management Trade messaging Reporting  Product identifiers  Trade data  Compliance reports  Counterparty identifiers  Valuation data  Position reports  Event identifiers  Confirmation data  Valuation reports  Market data plug-ins  Event data  Real time trading reporting  Data acquisition  Messaging interface design  Excetion reports  Plug-in development  Message validation  Recording for audit trail  Data mapping  Real time submission to regulators  Data storage  MQ,FpML,FIXML support Leveraging Mindtree’s competency Custom application DAS EAI BPM Quality assurance developmentOur differentiatorsA few things in common with most  Initial assessment of the impact of  Periodic / ad hoc reporting of bothregulatory projects are ambiguities in EMIR on the existing business model trade-related and position datarequirements, tight timelines and  Strong project management  Reduction in process overheadsabove all, the customer’s reputational processes and controls through automationrisk and fear of high penalties. We  Increased market transparency,  Cost reduction throughunderstand this. Hence we deploy reduced operational risk, process improvementexperienced resources to work closely promotion of data accuracy  Improve TATwith customers, to mitigate any risks and and comprehensivenessdeliver high quality projects, on time.  Real time access for regulatorsAbout MindtreeMindtree is a global information technology solutions company with revenues of over USD 400 million. Our team of 11,000 experts engineermeaningful technology solutions to help businesses and societies flourish. We enable our customers achieve competitive advantage throughflexible and global delivery models, agile methodologies and expert frameworks.www.mindtree.com ©Mindtree Ltd 2013

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