APAC RMPG - smpg.info

APAC RMPG
ASX implementation of ISO 20022 for notification of
corporate actions
Karen Webb
Manager, Settlement Services
8 April 2015
Agenda
Introduction to ASX
Implementation of ISO 20022 for
corporate action notifications
• Challenges
• Objectives
• Solution
• Benefits
Q&A
Introduction to ASX
Role of ASX in the Australian market
4
Role of ASX in the Australian market
5
Implementation of ISO 20022
for corporate action
notifications
Challenges - standardisation at ASX
• Current mix of proprietary and some standardised messaging
Cash Market
Wholesale Market
CHESS
proprietary
Austraclear
15022
CA notification
proprietary
CA notification
15022
Customers
15022
Customers
15022
(e.g. custodians) mixed
• Early focus on corporate action notifications, at request of
customers
• Use of global standard protocols is a key objective for our
Technology Renewal Program
• Trade (cash market and futures)
• Post Trade (clearing and settlement)
7
Challenges in corporate action processing
• Complexity of events
• Numerous sources of information and non-standardised structure
• Multiple parties in announcement chain
• Operational risk
• Importance of corporate action information
• Costs to stakeholders and ASX
Therefore a need for:
• More timely, accurate, consistent (standardised) corporate action data
• Reduction of systemic risks and costs
• Achieve benefits to all stakeholders, including issuers and investors
• Be world class, globally connected
8
Challenges in traditional notification process
9
Project challenges
• Are all stakeholders aware of the end to end notification process?
• How to get 100% coverage so efficiencies are enjoyed equally?
• How to approach to consultation?
• How to achieve Issuers buy-in to new process?
• Need to review ASX Listings Compliance and Operations processes?
• How could we leverage our position as the portal for Issuer market
announcements to achieve the best outcome?
10
Project objectives
deliver a more streamlined and standardised
process for the announcement, data capture and
delivery of corporate action information
11
Project challenges
The approach to consultation and implementation
• Review the notification cycle
• Issuer survey on the announcement process and content
• Establishment of working group for detailed consultation
• Propose a mandatory process
• Minimise impact on issuers re new process
• Market Regulator engagement
• Phased approach – high volume / largely mandatory events first
• Reliance on improved technology / database
• Messaging gap analysis
• Online form design and questions
• Decision to go to ISO 20022
12
Why ISO 20022 for corporate actions?
• International comparison – adoption progress
• Position as market infrastructure to influence change
• Xml format
• More data, extension model
• Backwards compatibility
• Delivery channel options
• SWIFT solutions to smooth the path
• MyStandards
• IPLA
13
The process solution
The existing notification process – capture & dissemination of data
14
The process solution
New online form process and future view – potential direct upload
15
The technical solution
Application
Internal /
External
purpose
SWIFT MyStandards
External
Publication of usage guidelines for ISO 20022 format CA notification
Announcement web
portal (ASX Online)
External
New online form functionality, including workflow for issuers to
announce corporate actions
Market Announcement
Platform
Internal
Internal announcement review and release platform - enhanced to
identify structured vs. unstructured announcements; exception
management
Central database
Internal
Source of static data, accept and send xml format files, create CA
record, approval workflow. Also used for manual update to information.
Data Warehouse
Internal
Source of static, historical data.
Services existing batch style market information products.
Enterprise Service Bus
Internal
Receives proprietary xml CA record from central database, holds ISO
20022 templates and performs re-formatting, xml send to IPLA
IPLA (SWIFT)
Internal
Integration platform, custom module
SWIFTNet service
External
test and production service for ISO 20022 corporate action
notifications to customers
FTP service (ASXNet)
External
Alternate delivery of same xml file to customers
Customer portal
External
Delivery of other market information products
16
The benefits - improved notification process
17
The benefits – for all stakeholders
Investors
• Commit to ISO
20022
• Early adopters
benefit
• Improved efficiency,
lower risk ( costs)
• Extended data set
• STP opportunities
• ASX as key source
Information
providers,
custodians
• ASX position – information source
• Range of products – near real time,
batch, detailed data
• Responsive to customers
• Improved efficiency & lower risk for
operations
• Improved issuer compliance, listing
service
Information
Cycle
ASX
• Receive timely, transparent,
consistent information
• Institutional Investors – lower
processing cost
Issuer
• Improved investor
relations / take-up
• Improved mid to small
cap market coverage
• Improved compliance
• Improved announcement
process
• Reduction in post
announcement queries
The benefits – ASX product expansion
Product
Channel
csv
8.30am









11.30am
2.30pm
4.30pm


  



   
8.30am
ASX
Online
8.30pm EOD
3.00pm
 
ISO 20022
CA xml

SWIFTNet

Fixed field length
Existing





New

ASXNet
8.30pm
• Building our service to customers: expanding on the content, format and delivery times
for ReferencePoint Corporate Action products with new ISO20022 format
• Recognise that not all subscribers require xml, SWIFT channel, so will offer expanded
product suite, rather than replacement for now
19
The benefits - delivering market improvements
The stakeholder view
Issuer:
“the online forms are helpful and user friendly”
“the adoption of new technologies and online processes
such as this aligns with the company’s objective of being
innovative and efficient in the digital environment.”
“The calculation of dates is time-saving and their validation
is re-assuring”
ASX:
90% reduction in time to capture corporate action data
where online form is used
Benefits
Custodian: “Positive change requires the engagement of all key
players including issuers, registries, custodians and of
course, the ASX….. The initiative will allow for greater
levels of automation and control of our corporate event
announcement process”
“Standardisation and automation of the information flow
cuts down on the potential for transcription errors, and the
fact that announcements are accessed from the source of
truth contributes to satisfying the need for accuracy and
completeness.”
Q&A
22