[ THOUGHT LEADERSHIP | SOCIETE GENERALE SECURITIES SERVICES ]
As the industry closes in on three months since the US ’ shift to T + 1 , it is more apparent than ever that the effects of the significant market structure shifts are not solely limited to the realm of post-trade but are instead affecting the entire workflow .
The front-office is experiencing the knock-on impacts of the shortened settlement cycle and central securities depositories regulations , among other regulatory changes , exacerbating the need for truly integrated solutions .
Trading desks , usually happy to get their job done while typically ignoring post-trade processes , are more cognisant than ever of the importance of front-to-back solutions – it is ( literally ) not worth overlooking .
Unlocking the power of front-to-back
Alessandro Cavallari , managing director , head of international sales and Steve Gutowski , head of financial intermediaries and banks coverage for Societe Generale Securities Services ( SGSS ) unpack the significant impact of market structure developments on traders ’ operations from front-to-back , highlighting the importance of an integrated ‘ one-stop-shop ’ approach and keeping a finger on the pulse of change
Investing in integration Client demand for streamlined solutions is continually picking up pace as firms increasingly seek to reduce costs , eliminate dated legacy systems and ultimately seek a reliable one-stop-shop , single provider approach .
As fees are demonstrably being passed back along the value chain , threatening to eat into profits and loss on the desks , the front-office has firmly turned its head in the direction of what ’ s going on in the back .
Historically , the front-office may have empowered operational teams and network managers to appoint a settlement agent . Therefore , through continued innovation , settlement agents are in a prime position to effectively provide highly operationally resilient solutions .
These industry-wide investments show that back office is at the forefront of value creation , and no longer considered only as expenses to manage .
With this in mind , SGSS has honed its approach over the last 12 months in the pursuit of definitive efficiency . Earlier this year , Societe Generale combined its Clearing and Custody into a single service , as it restructured to deliver clearing , settlement and custody through an integrated model for financial intermediaries .
Bringing together nearly 30 years of clearing experience onto a robust and industry leading custody platform , has allowed for streamlined end-to-end processes including instruction processing and reporting . In turn this one-stop shop allows clients to maximise settlement efficiency and focus on their core activities .
This move is a key strategic pillar for the SGSS global transformation , spurred by the key market structure changes affecting trading processes , CSDR , Mifir and Mifid II , and most particularly T + 1 .
SGSS plays a vital role in enhancing T + 1 operational and settlement cycle efficiencies , which helps to reduce trading impacts , risk , and liquidity constraints . By providing cutting edge technology and sophisticated integrated post-trade platform solutions , notably straightthrough processing ( STP ), SGSS ensures faster and more accurate trade matching and settlement processes . This reduces the operational risk associated with delayed settlements and minimises the potential for settlement failures .
20 // TheTRADE // Q3 2024