You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
FEATURES<br />
Paul Moffat<br />
“Regardless of the <strong>com</strong>plexity of the exotic structure,<br />
settlement relates to the cash flows generated. Our<br />
solutions recognise this simplicity that resides within the<br />
<strong>com</strong>plexity of the overall structure, and addresses the<br />
settlement issue by simply focusing on cash flows.”<br />
Tools such as SunGard Intelli-suite of products can<br />
aid in the reconciliation of positions, and fails and<br />
break management processes that allow users to focus<br />
on the trades that are problematic. Systems that<br />
provide exception based processing significantly<br />
reduce risk, and enhance processing flexibility.<br />
Complex and exotic structures represent some<br />
challenges, all the way from instrument and trade<br />
creation, through risk management and further<br />
processing. Moffat believes the key to addressing these<br />
challenges is to deliver software and processes that are<br />
able to recognise both the uniqueness of the overall<br />
products, whilst also finding the <strong>com</strong>monality of the<br />
underlying structures that allows <strong>com</strong>plexity to be<br />
broken down to allow standard processing.<br />
He says: “Settlement is an excellent example of this<br />
approach. Regardless of the <strong>com</strong>plexity of the exotic<br />
structure, settlement relates to the cash flows<br />
generated. Our solutions recognise this simplicity that<br />
resides within the <strong>com</strong>plexity of the overall structure,<br />
and addresses the settlement issue by simply focusing<br />
on cash flows.”<br />
A maturing market<br />
Maroun Eddé, CEO of Murex, says that markets are<br />
64 | january 2010 e-FOREX<br />
going back to vanilla and simple structured products,<br />
and are maturing fast. New levels of <strong>com</strong>petition<br />
across financial institutions mean that banks want to<br />
improve end-to-end efficiency of transaction<br />
processing including, in one <strong>com</strong>plete value chain,<br />
quoting, execution, live risk management, processing<br />
and various connections with market-place services.<br />
This end-to-end efficiency needs to apply to vanilla<br />
and structured products similarly.<br />
The Murex structuring tool enables clients to<br />
“productize” new structures on the fly. You simply<br />
<strong>com</strong>bine multi leg or multi product structures into a<br />
single product that you can then publish to a predetermined<br />
group of users. Once published, a structure<br />
be<strong>com</strong>es “native” and can be processed with the same<br />
levels of automation as vanilla products. MX.3’s<br />
processing model also supports organisational<br />
<strong>com</strong>plexity, as it automatically mirrors and processes<br />
any type of sales/traders back-to-back, inter-entity, or<br />
micro-hedge <strong>com</strong>binations.”<br />
Maroun Edde<br />
“Financial institutions need to demonstrate that<br />
they have an extremely reliable infrastructure able<br />
to process massive volumes...”
Change language