Innovation Revs Up

Even with the LEI, Basel III, MiFID 2, Solvency II, Fatca and Target2-Securities (T2S) all on the reference data operations agenda (a list that might sound to a layperson like the dullest set of movie sequels ever), hearing the presentations and discussions at the European Financial Information Summit (EFIS) sponsored by Inside Reference Data and Inside Market Data on September 18 made clear that practitioners are pursuing a great deal of innovation in their space and being forward-thinking about managing the data and analytics that concern them.

As Nicholas Hamilton related in his reflections on EFIS in an online column, “Benefitting From The Best of Breed,” Adam Broun, a CIO in the front office at Credit Suisse, asked attendees to think about how to apply data achievements from other industries and fields in their work. Furthermore, in our “Interview With,” Broun details his ideas on how to best leverage data that firms are being required to track and compile due to all those regulations just mentioned, and the need to organize data management processes so multiple regulatory needs are met all in one go.

Last issue, I pointed to the thread of concern about transparency throughout pricing and transparency. Our webcast on September 11, moderated by Hamilton, found panelists describing how they are implementing transparency in their approach to pricing and valuations. Greg Carlin of S&P Capital IQ identified structured retail products as an asset class where dealer firms are concerned about marking to models when doing valuations. Service providers are doing well at responding to queries from users who want greater transparency, said Daniel Johnson of Wells Fargo, and are seeking to learn how clients intend to use the data to better support that transparency.

We also report on a few other fields of reference data innovation: cloud computing, downstream data management and semantic data. Cloud technology, covered in our most recent webcast, is being applied to the ubiquitous problem of cost containment for reference data operations, and more specifically, to the problem of lack of resources—particularly in corporate actions processing, to name just one area.

Also during EFIS, experts from UBS, RBS, Bloomberg PolarLake and Informatica gathered to consider how to best manage reference data distribution downstream within firms and out to clients. Downstream data management involves complex challenges in figuring out how to work across data silos and finding nimble, less bloated data management systems to handle the distribution process. This is another area where practitioners are pressing for innovation. Lastly, semantic data technology, which like cloud computing and the data elements from other industries Broun identifies, is having an impact on reference data. Our report suggests this new technology will apply greater logic and clarity to enterprise data management. Read on to find useful and applicable details beyond the regulatory alphabet soup.