EMXCo & Euroclear collaboration efforts in the funds sector go live

The drive to deliver integrated order routing and straight-through processing (STP) settlement for transactions in UK, Irish, Guernsey, Jersey and Isle of Man domiciled funds is underway with the launch of phase one of EMXCo and Euroclear UK & Ireland’s Cash Settlement for Funds system. The aim is to shrink processing costs and alleviate administration burdens by combining the EMX Message System with Euroclear’s settlement infrastructure. From now on, the cash movement of all orders placed via EMXCo, will be settled via Euroclear. Next year, the UK & Ireland division intends to launch phase two of the collaboration effort, which will reflect funds unit movements in notional client accounts, improving traceability and reporting

Commenting on the link-up, Yannic Weber, CEO of Euroclear UK & Ireland, said: “This is a huge step forward in bringing automation to a key asset class [unitised funds] in the UK. We’re on the way to eliminating manual intervention, decreasing settlement and market risks, and reducing processing costs.”

The two firms, now of course part of the same group, also announced a further collaboration. Euroclear Bank’s global FundSettle platform, which covers 37,000 investment funds worldwide, is establishing an automated link to the EMX Message System. Again, the thinking behind the link-up is to combine fund settlement capabilities, this time internationally, with EMXCo’s order routing business, with the aim of enhancing STP. “I’m delighted to welcome FundSettle to our system,” said Max Wright, CEO of EMXCo. “Our aim is to rid the funds industry of inefficiencies.”

• Euroclear’s takeover of the Nordic Central Securities Depository and its subsidiaries, APK and VPC, the Finnish and Swedish CSDs respectively, was completed on 31 October. As a result of platform consolidation, via the Single Platform programme, and market practice harmonisation, clients of the combined organisation can expect to save more than f350 million per year in back office and operational costs, claim the firm.

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