SunGard has launched a new industry utility for post-trade futures and cleared over-the-counter derivatives operations, intended to help firms to adapt with market changes and respond to post-crisis regulatory cost pressures.
The utility is designed to allow derivatives brokers, including futures commission merchants, to improve efficiency and reduce operational risk, as well as reducing the total cost of ownership, by using economies of scale in middle- and back-office processing and technology.
Barclays will the utility’s first customer, and will migrate some futures, OTC derivative clearing operations and technical processes. Some Barclays staff will also transfer to SunGard.
As well as derivatives clearing operations, SunGard’s utility customers will be provided with technology services for trade clearing and trade lifecycle management, margin processing, brokerage, reconciliation, data management and regulatory reporting.
This will all be underpinned globally by existing SunGard solutions.
Brian Traquair, executive vice president of SunGard, said: “Post-trade cleared derivatives processing is highly commoditised, providing little differentiated value to each firm at increasingly higher costs, due to today’s regulatory environment.”
“SunGard’s post-trade derivatives utility will help transform the cleared derivatives middle and back office across the entire industry, resulting in a more sustainable operating model and cost structure for the future.”
Tim Stack, head of agency derivatives services at Barclays, commented: “Barclays has always taken a proactive approach to managing its business and adapting to regulation. By taking this leadership position with SunGard, we are able to provide our clients with a practical solution that keeps our products and services at the forefront of the industry.”
“We are confident that this utility is a transformational change for the industry, and that it will help provide clear benefits to our clients, to Barclays and to the industry as a whole.”
