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SFTR Reporting

Securities Financing Transactions Regulation

Client Briefing

Key benefits

Pirum is actively working with clients, industry bodies and other market infrastructure providers to identify and discuss the changes that are required to implement SFTR transaction reporting. We are currently upgrading our systems to fully support these requirements. Please contact us to find out more about our offering.

SFTR Reporting in a Nutshell

  • SFTR applies to EU legal entities / EU branches of non-EU entities

  • New / Modified / Closed SFTs must be reported, estimated to start Q1 2020

  • Reporting is broadly expected to follow existing EMIR derivative standards and will be a two sided reporting requirement

  • Counterparties must be identified using Legal Entity Identifier “LEI” codes

  • Electronic platform providers to issue unique transaction identifiers “UTIs”

  • Eligible / Actual collateral re-use to be both identified and reported daily

  • Significant system upgrades are required to support SFTR ahead of go-live – planning should start now!

Investment Banks / Asset Managers / Pension Funds / Insurance Companies / Agent Lenders / Alternative Investment Funds

SFTR Background

As part of the policies identified by the Financial Stability Board (FSB) to increase transparency across Securities Financing Transactions (SFTs), the EU introduced the Securities Finance Transaction Regulation (SFTR). The regulation includes a number of new rules for market participants including a requirement to report all SFTs to a registered Trade Repository (TR).

Pirum / IHS Markit SFTR Solution Factsheet


Key Reporting Requirements

SFTR is a two-sided reporting requirement, with both collateral provider (borrower) and collateral receiver (lender) required to report their side of the SFT to an approved TR on trade date +1 (T+1).

All new SFTs, modifications of open SFT’s and terminations of existing SFTs must be reported daily.

Collateral is reported on T+1 or value date +1 (S+1) dependent on the method of collateralisation used.

As part of the two-sided reporting obligation a Unique Transaction Identifier (UTI) must be included by participants in their reports to the TRs. This value will be used by the TRs to match separately received reports from each counterpart to an SFT.

Participants must also use Legal Entity Identifiers (LEIs) to identify their counterparts along with a number of other parties involved in the SFT (e.g. Agent Lenders, CSDs, CCPs).

For agency loans with multiple underlying principals both borrower and lender will need to report each allocation to a principal as an individually reportable transaction.

The SFTR reporting must also include any collateral linked to the SFTs including the LEI of the counterparty with whom the collateral was exchanged and the master agreement under which it was agreed.


Next Steps

ESMA published the final reporting standards at the end of March 2017. Now that they have been released there are several steps that the various EU bodies need to complete before they are enacted, including approval by the European Commission and period of scrutiny by the European Parliament.

Once agreed, the standards are estimated to be published in the Official Journal in Q1 2019. Firms are then required to report 12 months after the publication of the standards with a phased implementation from go-live:

  • Phase 1 (Q1 2020): Investment Firms and Credit Institutions.
  • Phase 2 (+3 months from go-live): Central Counterparties and Central Securities Depositories.
  • Phase 3 (+6 months from go-live): UCITS Funds, Alternative Investment Funds, Insurance Firms and Pension Funds.
  • Phase 4 (+9 months from go-live): Corporates (Non-Financial Counterparties).

SFTR News & Media

March 2018 – Five more firms join as Design Partners for Pirum / IHS Markit SFTR Reporting Solution

December 2017 – Pirum contribution to the assetservicingtimes.com Regulatory Handbook

December 2017 – SFTR Recap and Latest Q&A

October 2017 – UTI Generation and Reconciliation

October 2017 – Six firms commit as Design Partners for Pirum / IHS Markit SFTR Reporting Solution

April 2017 – Final RTS Summary – Client Briefing

March 2017 – The Roadmap to SFTR Implementation

February 2017 – Pirum / IHS Markit Q&A

February 2017 – Pirum / IHS Markit SFTR Press Release

December 2016 – Pirum’s SFTR Solution – We’ve got you covered

December 2016 – SFTR Getting Down to Business on the Details

October 2016 – Global Investor Magazine SFTR article

February 2016 – Pirum’s Client Briefing


Pirum Contacts

Robert Frost  
Head of Product Development
T: +44 20 7220 0971
E: robert.frost@pirum.com
Duncan Carpenter Robert Keane
Head of SFTR Product Development
T: +44 20 7220 0979 T: +44 20 7220 0967
E: duncan.carpenter@pirum.com E: robert.keane@pirum.com

The information contained on this website is based on Pirum’s own interpretation of the SFTR regulation as it stands at the time of writing and its view of the likely systems changes that will be required as a result. Pirum is not a law firm and this briefing must not be used as a substitute for legal advice from suitably qualified law professionals.
© Pirum Systems Limited