Northern Trust has automated the processing of the full trade settlement lifecycle for syndicated bank loans through integration with IHS Markit’s ClearPar custodian services messaging capability.
This is set to enable Northern Trust to map critical trade funding information ‘seamlessly’ into its proprietary bank loan, allowing it to provide digital access to all parties in a transaction.
Meanwhile, key transaction data including settlement date, settlement amounts and wire instructions are streamlined and communicated electronically, Northern Trust explained.
Northern Trust will then be able to accommodate the triple digit trade volume increase it has experienced in the last five years.
IHS Markit’s ClearPar custodian services are designed to deliver trade data in a standardised format via secured communications.
According to Northern Trust, this service increases scalability and efficiency while reducing the risks inherent in a manual trade settlement process.
Pete Cherecwich, president of corporate and institutional services for Northern Trust, highlighted that syndicated loans are an increasingly important asset class for the bank’s institutional investors and family offices seeking higher yields.
He commented: “Integration with trade platforms such as ClearPar removes the potential for latency in the process and demonstrates our commitment to delivering timely and accurate daily data to our clients across the globe.”
“Our work with IHS Markit to automate trade and payment information not only drives efficiency but enhances risk management. This integration raises the bar in complex asset processing – it is a major advance for Northern Trust and the syndicated loans market and will deliver tangible benefits to our clients,” Cherecwich noted.
Patricia Tessier, managing director and co-head of loan platforms at IHS Markit, added: “Northern Trust has achieved a unique level of custodian integration with ClearPar. The new levels of service and scale Northern Trust can deliver to clients are illustrations of how technology is transforming the full operational life cycle in the leveraged loan market, from trade closing to portfolio management to asset servicing.”
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