The Depository Trust & Clearing Corporation (DTCC) has launched a global corporate action (GCA) validation service that will provide clients with access to an automated and centralised source of corporate action announcement data.
DTCC teamed with Accenture to develop the service. The vendor provided programme management support, helped to implement GCA's underlying technology and is continuing to work with the corporation in enhancing the operating environment.
GCA analyses a range of corporate action data, including information sourced from a wide range of commercial information providers. The service eliminates the need for firms to perform these procedures and simplifies the entire process from the initial announcement capture through data validation.
Data is validated through a processes of mapping, normalising and consolidating, which is done using XcitekSolutionsPlus' XSP corporate actions data management module. In addition, GCA applies a broad definition to corporate actions to include both straightforward mandatory events and more complex voluntary offerings.
DTCC says the service will enable all financial institutions to receive the data they need at the same time.
James Femia, managing director, DTCC Asset Services, adds that corporate action processing is an area of significant risk in the securities processing business.
"Rather than have each bank and broker/dealer maintain its own operation to collect and verify corporate action announcement information, we'll provide the single right answer," says Femia.
According to Femia, custodian verification is an important part of what will set GCA apart from other service providers in the market space.
"We'll act on our participants' behalf, going to their custodians to verify data, while protecting the proprietary nature of the custodians' information," he says.
DTCC launched a pilot of GCA with a major global securities firm this month and several other firms are expected to follow shortly. The service will initially cover securities traded in the Americas and Europe but will provide global coverage by the time it is fully operational at the end of the year.