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Feb 27, 2020

Pirum launches CSDR fails cost reporting and enhances SSI enrichment service

12 months ahead of impending go live of CSDR Regulation, Pirum Systems launches a new CSDR fails report, enabling clients to determine the impact of CSDR on their securities finance business and the associated costs.

With the expected go-live of CSDR in early Q1 2021, firms are looking to improve fails management across their securities finance businesses. Analysis by Pirum shows that its clients could be facing fails fines of €80-110 million per year, with an estimated fails management cost of €120 million and CSDR fines management costs of up to €85 million. The total costs could be as much as €300 million per annum.

For firms yet to start, or at an early stage with their CSDR program, Pirum can help accelerate their preparation by adopting real-time pre and post-trade reconciliation and process automation across their securities financing business, including Securities Lending, Repo and Collateral postings.

Pirum Systems has also enhanced its SSI enrichment services – allowing firms to enrich and reconcile SSIs at the trade level, in order to prioritise and minimise fails due to mis-matching settlement instructions. Over 35 firms are now using the service to enhance their trade files with over 100,000 SSIs and get a real-time view of SSI instruction problems across all markets, including European markets.

Robert Frost, Head of Product Development and Client Services at Pirum Systems says: “Clients recognise the significant impact that CSDR will bring and are looking to automate their processes to reduce costs. Following feedback from our CSDR working group, we are introducing a new CSDR fails report that includes estimated CSDR cost – to enable firms to see what the impact is today, in order to remediate their processes ahead of the go-live date. In addition, we continue to rollout our SSI enrichment service to firms and are working with our clients to develop new solutions to assist with fails prevention for all markets.”

Phil Morgan, COO at Pirum Systems says: “We’re seeing an acceleration in the rollout of our real-time post trade services to help firms maximise the benefits of increased STP rates, whilst reducing fails. This provides benefits immediately with both fails and exposure management but importantly helps firms prepare for the introduction of CSDR. Firms that have taken advantage of the process automation that Pirum offer, have seen fails reduce by nearly 80% across their securities lending and repo businesses, and we are committed to rolling out further services next year to help clients improve this further. “