Preparing for Dodd Frank: Clearing with MarkitSERV

Transcription

1 Preparing for Dodd Frank: Clearing with MarkitSERV

2 Agenda Introduction: clearing update Clearing solutions Clearing connectivity options Client clearing workflow Setup requirements standard Connectivity-specific requirements MarkitWire GUI MarkitSERV Trade Manager (MTM) clearing CSV DSMatch Credit clearing CSV MarkitSERV Client API Documentation guidelines Contacts 2

3 Introduction Required regulatory reporting under Dodd-Frank will commence on October 12, Mandatory clearing dates will follow soon, and now is the time to prepare. As the market leader in providing clearing connectivity, we encourage you to leverage our platform for one-stop acclimation into the new regulatory environment. MarkitSERV provides connectivity between dealers, buy-side clients, brokers, clearing brokers, clearinghouses, regulators and exchanges to provide real-time clearing solutions across the entire market. MarkitSERV is fully connected to every major clearinghouse and will continue to build to CCPs as they open, so you only need to connect to MarkitSERV. The first products that will be subject to mandatory clearing are IRS, Basis Swaps, OIS, FRAs, CDS single names and CDS indices. Equity derivatives and FX products will be next. 3

4 Clearinghouse coverage Clearing House Product MarkitSERV Availability for Client Clearing CME (Clearing US) Credit, FX, Rates Live for both UAT and Production for all asset classes CME Clearing Europe Rates UAT Live/ November 5, 2012 EUREX Rates UAT Live/ Production expected in November 9, 2012 HKEx FX, Rates (FX) UAT Q1 2013/ Production TBD, (Rates) UAT November 2012/ Production December 2012 ICE Clear Credit Credit UAT Live/ Production October 2012 ICE Clear Europe Credit Currently not clearing D2C, MarkitWire will be live in UAT and Production upon ICE CE go live JSCC Rates Client clearing TBD for UAT and Production KDPW Rates UAT Q4 2012/ Production End of Year 2012 KRX Rates UAT Q4 2012/ Production End of Year 2012 LCH Clearnet Limited (EU) Rates Live for both UAT and Production LCH.Clearnet SA Credit Client clearing TBD for UAT and Production LCH Clearnet US Rates UAT Live/ Production October 2012 LCH.Clearnet ForexClear FX UAT Live/ Production Q NASDAQ OMX Rates Live for both UAT and Production OCC Equity CCP simulator available now; end-to-end UAT Q1 2013/ Production TBD SGX FX, Rates UAT Q

5 Clearing solutions Affirmation option Review alleged trade on-screen Amend trade and submit change electronically back to counterparty Online dispute resolution no need to make calls Matching option Submit your version of the trade (via CSV or FpML) MarkitSERV matching engine automatically identifies breaks no need for manual review Fully matched trades STP directly to CCP Online dispute resolution no need to make calls

6 Clearing connectivity options Connectivity Option MarkitWire DSMatch CSV MarkitSERV Trade Manager CSV MarkitSERV Client API Who? For clients who wish to review trades in multiple asset classes via web (e.g., low clearing volume) For existing DSMatch credit spreadsheet users or credit only firms For clients who wish to match cleared trades across multiple asset classes or manage cleared and bilateral workflows on one platform For clients who prefer matching and real-time integration with internal systems or vendors 6

7 Client clearing workflow Buy-side Client Executing Broker MarkitSERV Clearinghouse DSMatch MTM MarkitWire Clearing Broker 7

8 Standard set-up requirements Client requirements Counterparty requirements Clearinghouse requirements Fund names Fund codes Users Product listings Additional/excluded Executing Brokers FCMs & applicable funds FCM authorization Master agreement dates (credit only) Information above provided via Data Gathering Sheet ( DGS ) CME: Alias ID ICE: ICE ID MarkitSERV establishes trading permissions based on counterparty data Clearinghouse requirements are provided by either the client or their clearing broker UAT available for external testing with FCM, executing brokers and CCPs Setup MarkitSERV Portal access for single-sign on Note: No additional connectivity setup is required if MarkitWire direct option is selected by your firm 8

9 Sample CME mapping table As Client Knows It In MarkitWire At CME End User Entity Clearing Broker (CB) MW Fund Code MW CB Name MW CB ID CME ID Example1 ABC Fund 1 CB1 FUND_1 MW CB 1 MW_CB1_BIC CCP_FUND1_CB1 Example2 ABC Fund 2 CB1 FUND_2 MW CB 1 MW_CB1_BIC CCP_FUND2_CB1 Example3 ABC Fund 2 CB2 FUND_2 MW CB 2 MW_CB2_BIC CCP_FUND2_CB2 9

10 Sample ICE mapping table As Client Knows It End User Entity MW Fund Code At ICE ICE Fund ID As Client Knows It In MarkitWire At ICE Clearing Broker (CB) MW CB Name MW CB ID ICE CB ID Example1 ABC Fund 1 FUND_1 ICE_ID1 CB1 MW CB 1 MW_CB1_BIC CCP_CB1 Example2 ABC Fund 2 FUND_2 ICE_ID2 CB1 MW CB 1 MW_CB1_BIC CCP_CB1 Example3 ABC Fund 2 FUND_2 ICE_ID2 CB2 MW CB 2 MW_CB2_BIC CCP_CB2 10

11 Sample LCH mapping table As Client Knows It In MarkitWire End User Entity Clearing Broker (CB) MW Fund Code MW CB Name MW CB ID Example1 ABC Fund 1 CB1 FUND_1 MW CB 1 MW_CB1_BIC Example2 ABC Fund 2 CB1 FUND_2 MW CB 1 MW_CB1_BIC Example3 ABC Fund 2 CB2 FUND_2 MW CB 2 MW_CB2_BIC 11

12 MarkitWire GUI Buy-Side Client Standard setup requirements from Data Gathering Sheet Create Production client environment Create parent company profile Configure parent for selected products Create funds Create users and configure for clearing MarkitWire training session Confirm connectivity 12

13 MarkitWire GUI MarkitWire TC Client MarkitWire Web Portal 13

14 MarkitSERV Trade Manager clearing CSV Standard setup requirements from Data Gathering Sheet Development and testing activities Create or augment MTM file for key fields, including: Broker ID (CB/FCM) Executing Broker Intended For Clearing Clearinghouse Establish FTP connection (unless web upload or used) Review/conduct test scripts MTM training session 14

15 DSMatch Credit clearing CSV Standard setup requirements from Data Gathering Sheet Development and testing activities Augment DSMatch file for clearing information Block Reference Number Clearing House Clearing Broker For allocating clients, modify file for blocking trades Add client credit clearing eligibility to DSMatch O-code Map all required relationships between the clearing broker, executing broker, client and CCP on the MarkitWire platform: Trading and clearing configurations Clearing broker mappings Alias mappings Additional setups MTM training session Note: If your firm has no prior MarkitWire activity, you will be required to establish funds and relationship information on MarkitWire 15

16 MarkitSERV Client API Standard setup requirements from Data Gathering Sheet Development and testing activities MQ connectivity Leverage existing MQ link, technology provider or internal build Block account created on DSMatch Build/Test FpML formatted messages in UAT Perform Credit v10 schema & FpML v4.9 updates Perform Rates v5.0 schema & FpML v4.3 updates Review/Execute Client API test scripts Connectivity-specific documentation Submit Router Exchange Form and two MQ Page 1 forms (UAT/Prod) to PIPSetup@dtcc.com Vendor/Supplemental Form (Applicable if leveraging MQ from technology provider) 16

17 Documentation Guidelines for Existing Clients Existing DSMatch Credit Confirmation client adding MarkitWire Read and acknowledge the MarkitWire Supplement Existing DSMatch and/or MarkitWire client reconciling accounts across platforms MarkitSERV can provide firm with their fund lists for account reconciliation MarkitSERV Amended Annex I Form Existing DSMatch or MarkitWire client adding Trade Manager MarkitSERV Master Agreement Supplement to the Operating Procedures (Includes Master Agreement/Trade Processing Addendum Standard Terms) Supplemental Agreement (Applies for Client API setups who are utilizing a technology provider) Existing DSMatch and/or MarkitWire client adding an account MarkitSERV Amended Annex I Form Note: Legacy Deriv/SERV and Legacy Swapswire participants may require other documents

18 Contacts For further information about MarkitSERV clearing solutions, please contact: Account Management Sales Clearing Product Management Client Services 18

19 Disclaimer The content, information and any materials ( data ) provided by MarkitSERV and/or its group companies ("MarkitSERV") in this presentation is on an as is basis. MarkitSERV expressly disclaims all warranties, expressed or implied, as to the accuracy of any data provided, including, without limitation, liability for quality, performance and fitness for a particular purpose arising out of the use of the data. MarkitSERV shall not have any liability, duty or obligation for or relating to the data contained herein, any errors, inaccuracies, omissions or delays in the data, or for any actions taken in reliance thereon. In no event shall MarkitSERV be liable for damages, including, without limitation, damages resulting from lost data or information or lost profits or revenue, the costs of recovering such data, the costs of substitute data, claims by third parties of for other similar costs, or any special, incidental, or consequential damages, arising out of the use of the data. Any unauthorised use, including but not limited to copying, distributing, transmitting or otherwise of any data appearing may violate the intellectual property rights of MarkitSERV under any intellectual property laws such as copyright laws, trademark laws and communications, regulations and statutes. MarkitSERV Limited is authorised and regulated by the Financial Services Authority. This communication is directed only at persons who can be categorised as Eligible Counterparties or Professional Clients in accordance with COB 3.5 & 3.6 of the FSA Handbook, and the services described herein are available only to such persons. Any other persons should not rely on any information contained in this material. 19