Business Entity Data special report

November 2011 - sponsored by: S&P CapitalIQ, Thomson Reuters, Wipro

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The Means to Implement LEIs

The Virtual Roundtable in this special report provides an exclusive insight into how burgeoning amounts of securities data are creating a need for data management projects even outside the mandate for meeting a legal entity identifier (LEI) standard.

Roundtable participants, especially from financial services firms, blame missing or low-quality information for their inability to get a full picture of an entity that is the basis for a security. Philippe Rozental of Société Générale says his firm addresses this by having at least two providers for each data point, even though this is more costly and requires continuous effort to find and choose providers, test them for long amounts of time, and adopt controls. Genevy Dimitrion of State Street identifies a need for cross-referencing sources, establishing a centralized data repository and for firms to put aside control of content in favor of collaboration in support of the LEI initiative.

Data integration has also become a "must," says Rozental, when calculating global exposures. Using a single data copy to calculate risk exposure or independent prices for complex instruments can reduce costs and issues with calculation, he adds.

Aside from the LEI standard, panelists say new regulations such as Solvency II reporting rules and value-at-risk calculation requirements for Ucits IV regulated funds also should be considered as part of business entity data management efforts.

Whatever the approach to data management projects necessitated by LEI and other new rules, service providers will have a role to play, as Capco's Sean Culbert indicates in a News Review piece in this report. The LEI alone is driving many changes in firms' responsibilities and what will be required of them.

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