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Taking the Pain Out of Post-Trade Processing for Custodians

At DTCC, we understand the critical role that custodian banks play in helping to ensure the safety of assets in the global financial markets.

Enhancing post-trade efficiency for custodians

Our market-leading suite of services helps resolve key pain points for custodians across their post-trade infrastructure.

From optimizing trade and collateral settlements to delivering efficiencies in the management of corporate actions and tax events, our services help to reduce risk and enhance post-trade efficiency for custodians.


Download our brochure and infographic today to learn more about how DTCC works to resolve post-trade pain points for custodians.


Resolving key custodian pain points

DTCC’s services enable custodians to mitigate key operational pain points:

1. Timely Receipt of Settlement Notifications:

DTCC’s Institutional Trade Processing (ITP) services help to improve the timely receipt of settlement notifications by custodians.

Trade data that has been matched via the CTMTM or OASYSTM platforms and enriched with standing settlement instructions (SSI), through the ALERT® service, is communicated to custodians as a settlement notification via SWIFT format. This enables custodians to quickly process and settle trades on behalf of their clients.

In addition, the DTCC Exception Manager platform provides additional value to custodians by allowing them to publish, manage and communicate on exceptions throughout the trade lifecycle process.

2. Accurate Settlement Notifications:

Custodians often receive settlement notifications that contain inaccurate data. The most common cause of this is inaccurate SSI data.

ALERT, the industry’s largest and most compliant web-based global database for the maintenance and communication of account and SSI, offers a Global Custodian Direct (GC Direct) workflow that enables custodian banks to electronically manage settlement instructions on behalf of their buy-side clients via dedicated ISO 20022 compliant messages.

To learn more about DTCC’s ITP services, visit www.dtcc.com/itp.

3. Standardized Communications around Collateral and Settlement:

DTCC-Euroclear GlobalCollateral Ltd’s Margin Transit Utility (MTU) offers straight-through processing of margin and collateral settlement for dealers and buy-side firms. This allows custodians to process and confirm collateral settlements quickly and securely, thereby enhancing their own efficiencies to better serve clients.

To learn more, visit www.GlobalCollateral.net.

Custodians utilizing DTCC’s ITP suite of services can also standardize communications around the settlement process through its straight-through-processing workflow (STP). This helps to ensure that accurate trade data can then be settled via DTC and can reduce costs and delays associated with failures during post-trade settlement.

4. Manual Processing for Corporate Actions Notifications:

The accuracy of the information contained in voluntary reorganizations announcements is critical as buy-side firms rely upon it to make investment decisions that can result in significant financial gains and losses.

DTCC’s Corporate Actions teams have worked closely with global custodians to create a harmonized ISO20022 messaging format that enhances automation and straight through processing. This helps to eliminate inaccuracies and errors within announcements data that is sent to the buy-side and beneficial owners.

To learn more, visit our corporate actions processing webpage.

5. Risk and costs in holding physical securities:

US-based custodians can use DTCC’s Custody Service to outsource the handling and servicing of physical securities on behalf of their buy-side clients. The Custody Service enables custodians to retain control of these securities without having to handle and secure them themselves.

To learn more, visit our custody service webpage.

6. Manual Processing and Tracking of Tax Events:

DTCC’s 305(c) Announcements Service provides custodians with timely notifications around withholding tax obligations as they occur. This service helps custodians to avoid manual processing and investment around tracking tax events and ensures that they effectively meet their IRS withholding tax obligations.

To learn more, visit www.dtcc.com/globaltax

7. Increasing Efficiency in Settlement Processes:

With money settlement not occurring until the end of the day (after the night cycle process), capital can become trapped in the very same system designed to manage securities processing and cash movements.

Custodians must wait for the transfer of securities and associated payments to take place in a timely manner before liquidity can be freed up for their buy-side clients.

DTCC’s settlement optimization initiative can help custodians to achieve clearing and settlement processing efficiency, promote settlement finality, reduce equity clearing margin requirements, and provide liquidity enhancements, helping custodians custodians to offer a more efficient service to their clients.

To stay updated on the settlement optimization initiative please visit dtcclearning.com/optimization.

Contact us today to learn more about how DTCC can help you.

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