Large banks can currently spend between $6 billion to $9 billion processing standardised trades annually.
The study, Charting a Path to Post-Trade Utility, suggests that by sharing in a range of trade processing functions—from core post-trade processing, reference data and reconciliations to trade expense management, corporate actions, and tax and regulatory reporting—in a utility model, the industry could save up to $4 billion each year.
The report stated: “Post-trade processing represents a natural starting point for an industry utility. It is central to the trade lifecycle—matching buyer and seller records, confirming trade terms, clearing and settling trades, calculating margins and performing custody and asset servicing.”
“As the system of record for banks, it also delivers a range of data useful to other critical functions, including corporate actions, tax and regulatory reporting, and reference data.”
“A post-trade utility would mutualise regulatory investments and aid with ‘living wills’, which require large institutions to show how they would plan for an orderly resolution process in the event of a failure.”