Webinar : Implementing SFTR: The Impact & Challenges that lie ahead
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While few RegTech solution providers are rolling up their sleeves for SFTR in the early stages, many financial institutions still struggle on the data enrichment and business rules validation on SFTR reporting obligation until successfully executing User Acceptance Testing scenarios. This webinar will discuss about those growing SFTR implementation challenges, data & report lifecycle and improving data quality on SFT Reporting Institutions.
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Webinar : Implementing SFTR: The Impact & Challenges that lie ahead
- 1. 1© Sensiple. All rights reserved Webinar on SFTR: Implementations, Impact & Challenges that lie ahead CORPORATE OFFICE 555 US Highway 1 S, Ste 330 Iselin, NJ 08830,USA USA@sensiple.com +1 732-283-0801 MIDWEST OFFICE Aksarben Village, 2111 South 67th Street, Suite 300 Omaha, NE 68106, USA Omaha@Sensiple.com +1 402-337-2921 NORTHWEST OFFICE San Francisco- Market Plaza, One Market, Spear Tower, 36th floor, San Francisco, CA 94105, USA Sanfrancisco@sensiple.com +1 415-293-7880 CHENNAI OFFICE Plot No: 9/A15, SIPCOT IT Park, Padur Post, Siruseri, Chennai 603 103 , Tamilnadu, India India-team@Sensiple.com +91 44 4741 9000 MUMBAI OFFICE Level 13, R-Tech Park, Nirlon Knowledge Park, Off Western Express Highway, Goregaon (E) – Mumbai 400063 India-team@Sensiple.com +91 22 44764656 LONDON OFFICE 85 Great Portland Street, First Floor, London W1W 7LT India-team@Sensiple.com 020-3745-0386
- 2. 2© Sensiple. All rights reserved Webinar Etiquettes Questions will be answered at the end of session in the order in which they are received In case if you do not receive answers to your question today, you will certainly receive answers via email shortly All phones are set to mute. If you have questions, please type them in the Chat window located beside the presentation panel Thanks for your participation and enjoy the session!
- 3. 3© Sensiple. All rights reserved Years of IT Experience 20+ Projects 450+ Global Customers 150+ US & Asia Pacific Global Presence Diverse Talent Pool 600+ Customer Retention 90% Products 20+ Expertise BFSI, FinTech Our Accreditations Innovation Lab R&D Our Partners
- 4. 4© Sensiple. All rights reserved© Sensiple. All rights reserved Speakers 20+ years of expertise in enabling technologies for Banking and Financial Services industry. His recent role is with Sensiple Inc. as Business Head, BFSI Industry. Vijay Gopal Head – RegTech RnD & Business Unit Products Head –RegTech Solutions ArulPrabha Krishnan Business Head – RegTech Solutions Amalan Nagarajan 15+ years of experience in Business Architect and Solution Designer, responsible for Strategy, Planning, Implementation and Roadmap Management of Post- Trade Transparency & Regulatory Compliance Products such as EMIR, MIFIR and SFTR 15+ years of Post Trade and RegTech Products Head with impeccable business deliveries to the financial institutions around the globe. Responsible for strategy, planning and implementation of Post Trade and Regulatory products Sales Head – RegTech Solutions Naveen Chandu Sivadasan 10+ years of experience in Capital Markets & Regulatory compliance space with a key focus towards customer success.. Great understanding of European regulations like MiFIR, EMIR, SFTR and other G20 regulations , financial institutions which complies with SEBI.
- 5. 5© Sensiple. All rights reserved© Sensiple. All rights reserved Agenda Why Setrega? How SETREGA can help to report to SFTR Regulations? Q&A Recent Changes in RegTech Landscape About SFTR & a quick foreground to SFTR Challenges SFTR Implementation Challenges and its Impact
- 6. 6© Sensiple. All rights reserved Recent Changes in RegTech Landscape Emerging technology Cost of compliance Cloud computing Understanding regulatory needs Reactive approach not Proactive Market saturation Long procurement cycle Recent Changes in RegTech Landscape
- 7. 7© Sensiple. All rights reserved SFTR and its Pillars Reduce systemic risks in securities lending Risk Mitigation Greater visibility of Collateral reuse Transparency Broadening the ambit of the regulation through wider participants Extra-territoriality Reporting Obligation Reporting to a Trade Repository SFTR
- 8. 8© Sensiple. All rights reserved SFTR- A Quagmire of Complexities? In addition to SFT’s, it also includes the reporting of associated collaterals Conversion to ISO 20022 format with over 150 fields Unlike OTC derivatives, SFT’s contract duration can be for one day
- 9. 9© Sensiple. All rights reserved SFTR – Challenges and Considerations Data Exchange & Connectivity Standardization Reconciliation Reporting Obligations
- 10. 10© Sensiple. All rights reserved SFTR – Impact Areas Collateral Re-Use Collateral Re-Use Data should be available specific to counterparty because collateral is generally managed at Position Level. • Data Elements for Collateral Re-Sue • Collateral Re-Use Obligations Reporting Obligations Counterparties to an SFT must report their transaction details to Trade Repositories on T+1 day of Conclusion, Modification or Termination • Daily Reporting Obligations • Reconciliations Investor Transparency Transparency and Disclosure requirements are introduced for the managers who are processing SFT Transactions • Pre-Contractual Disclosure Requirements • Periodic Reporting
- 11. 11© Sensiple. All rights reserved SFTR – Reporting Insights Action Types New Modification Error Correction Position Component Collateral Component Termination Margin Update Report Types Transaction Reporting Repo Sell / Buy - Back Security Lending Margin Lending Margin Reporting Re-use Reporting In-Scope Transactions Concluded on or after the reporting start date detailed above Were concluded before, and remained outstanding on the reporting start date and either: Have a remaining maturity exceeding 180 days after the reporting start date; or Have an open maturity and actually remain outstanding for 180 days after the reporting start date.
- 12. 12© Sensiple. All rights reserved SFTR – Reporting Framework Trade Repository Submission Module Transaction Management Reconciliation Module Reporting Entity Report Transaction Processing Import Data Data Aggregation Transform and Validate Transmit Report Fix Transaction Errors Manage Exceptions Validate Data Export Transactions Fix Transaction Errors Reconcile Transactions Export CP Data Export Positions
- 13. 13© Sensiple. All rights reserved SFTR – Reporting Business Components Central Clearing Party Data Exchange DELEGATEDREPORTING EXCEPTIONMANAGEMENT Validation Enrichment Transaction Matching UTI Management Eligibility Checking Event Validation ISO 20022 Formatting Reporting Management Reconciliation Trading Platforms Post Trade Services Client Source 1 Client Source 2 Static Data Trade Repositories Third-Party Providers Dedicated Pipelines Reporting Processing Entity
- 14. 14© Sensiple. All rights reserved Setrega Benefits 02 03 04 05 06 07 A holistic platform Upload trade and market data Submit to a TR in a Quality assurance environment Configurable rule engine and templates Supports multiple regulatory frameworks (EMIR, MiFIR, SFTR). Enriched with UTI and product data with no manual intervention 08 End-to- End Managed services offering 01 Secured Data Maintenance
- 15. 15© Sensiple. All rights reserved Setrega Features End to End automation Right from Data aggregation till submission. UTI pairing Transaction pairing through UTI Real time processing Enrichment. Eligibility checks, Reconciliation, Exception management. Dashboard On demand analytics to support data-driven decision- making. Delegated Reporting Flexible Collaboration with counterparties. Reconciliation Superior Reconciliation capabilities 08 07 06 05 04 03 02 01 Intelligent Data Extraction High Precision Data Extraction, Intelligent Data Validation, Data Enrichment . Feedback Mechanism Feedback Review and Re- Submission Setrega Regulatory Reporting
- 16. 16© Sensiple. All rights reserved Setrega – Regulatory Reporting Process Flow Why Setrega Regulatory Reporting? • End to end automation of Banking regulatory requirements • Supports multiple regulatory frameworks (EMIR, MiFIR, SFTR) • Supports multiple regulatory authorities (ESMA, NCA, FCA) • Tracks the entire lifecycle of the regulatory reporting • Identifies regulatory breaches in prior • Trigger alerts and notifications to ensure reporting accuracy • Supports “Real-Time” as well “on- Demand” reporting • Provides Secured Data Maintenance • Quick adaption to regulatory changes • Predefined Rules/Alerts • Speech to Text Integration • Configurable Report Templates • Report generation and submission automation • Metadata and Reference data enrichment
- 17. 17© Sensiple. All rights reserved Q & A Session
- 18. Corporate HQ 555 US Highway 1 S, Ste 330 Iselin, NJ 08830 United States of America Plot No: 9/A15, SIPCOT IT Park, Padur, Siruseri, Chennai TN-603103, India Product Engineering & Innovation Hub www.sensiple.com New Jersey | Omaha | San Francisco | London | Mumbai | ChennaiOther Locations: Thank you
Editor's Notes
- End to End automation: SFT’s are traded in heterogenous markets and therefore capturing trade data like LEI is going to be a great challenge. SETREGA is a complete regulatory reporting platform for cross-asset, multi-jurisdictional trade reporting. SETREGA offers a one stop solution to support reporting across all asset classes, which includes collateral valuation and collateral reuse reporting to the trade repositories. UTI Pairing Like EMIR, SFTR is a dual-side reporting regulation that requires UTI matching of all reportable trades. Real time processing- Designed to easily translate transaction data to industry formats, pre-reporting eligibility rules engine that allows firms to perform eligibility check along with full traceability enrich data using various reference data sources, identify errors & missing data elements before submission to the TR Reconciliation Firms obligated to complete SFTR reporting should expect a large volume of initial transaction matching reconciliation breaks (similar to the trend that occurred in the EMIR rollout). As was also consistent with EMIR, these breaks are expected to decrease over time as the regulation matures. However, in preparation for this, an end-to-end reporting solution should have functionality to minimize time spent on correction and resubmission. A reporting solution should assist with the reconciliation process by providing in-application flexibility and efficiency to handle and correct breaks. It should handle this without technical intervention (where possible) to allow the business operational team to fix breaks, resolve mismatching, and swiftly resubmit. A configurable rule set will allow users to handle issues initially and then add validations to ensure they do not occur again in the future. Another aspect that will help create reconciliation efficiency in a solution is to maintain detailed data error handling and transaction history logging during the reconciliation process. This will allow users to follow a transaction through to origination and ultimately identify the root cause of the break or put a resolution in place upstream to prevent the issue in the future. ensure accurate reporting Pre-reporting & Post-reporting by comparing TR data vs. Internal data Tracing the trade data through out the entire lifecycle itself is making huge toll on the time & resources. Delegated Reporting Making integration with the Submitter seamless. Dashboard SFTR is an ideal opportunity to consolidate the process of Data management.There is a strong case for improve a firm’s data management capabilities because of the sheer volume mandated by ESMA.Firms are to report their daily transactions, including all lifecycle events like Collateral valuation, Collateral reuse statistics.Data driven intelligence should pave way for more business intelligence & risk management.
- End to End automation: SFT’s are traded in heterogenous markets and therefore capturing trade data like LEI is going to be a great challenge. SETREGA is a complete regulatory reporting platform for cross-asset, multi-jurisdictional trade reporting. SETREGA offers a one stop solution to support reporting across all asset classes, which includes collateral valuation and collateral reuse reporting to the trade repositories. UTI Pairing Like EMIR, SFTR is a dual-side reporting regulation that requires UTI matching of all reportable trades. Real time processing- Designed to easily translate transaction data to industry formats, pre-reporting eligibility rules engine that allows firms to perform eligibility check along with full traceability enrich data using various reference data sources, identify errors & missing data elements before submission to the TR Reconciliation Firms obligated to complete SFTR reporting should expect a large volume of initial transaction matching reconciliation breaks (similar to the trend that occurred in the EMIR rollout). As was also consistent with EMIR, these breaks are expected to decrease over time as the regulation matures. However, in preparation for this, an end-to-end reporting solution should have functionality to minimize time spent on correction and resubmission. A reporting solution should assist with the reconciliation process by providing in-application flexibility and efficiency to handle and correct breaks. It should handle this without technical intervention (where possible) to allow the business operational team to fix breaks, resolve mismatching, and swiftly resubmit. A configurable rule set will allow users to handle issues initially and then add validations to ensure they do not occur again in the future. Another aspect that will help create reconciliation efficiency in a solution is to maintain detailed data error handling and transaction history logging during the reconciliation process. This will allow users to follow a transaction through to origination and ultimately identify the root cause of the break or put a resolution in place upstream to prevent the issue in the future. ensure accurate reporting Pre-reporting & Post-reporting by comparing TR data vs. Internal data Tracing the trade data through out the entire lifecycle itself is making huge toll on the time & resources. Delegated Reporting Making integration with the Submitter seamless. Dashboard SFTR is an ideal opportunity to consolidate the process of Data management.There is a strong case for improve a firm’s data management capabilities because of the sheer volume mandated by ESMA.Firms are to report their daily transactions, including all lifecycle events like Collateral valuation, Collateral reuse statistics.Data driven intelligence should pave way for more business intelligence & risk management.