DTCC Trade Reporting of SWAPS.

Due to regulatory requirements, in particular the Dodd-Frank Wall Street Reform and Consumer Act, organisations trading SWAPs have had to report their transactions to regulated trade repositories since April 2013. KB TECH developed and implemented a reporting service, which provides an electronic connection to the Depository Trust and Clearing Corporation’s (DTCC) Global Trade Repository (GTR), allowing Brokers to automatically report client trades and comply with CFTC trade reporting requirements. This KB TECH DTCC reporting service has been successfully operating at Broker deployments since April 2013.

The Broker’s operations department utilises KB TECH’s front end GUI for entering, on behalf of their clients, the relevant trade data fields as required by the DTTC in order to be compliant for regulatory reporting purposes. The required data fields are converted to the relevant protocol and then transmitted with an assigned unique trade identifier into the DTCC GTR XML web services portal. This is referred to as the DTCC initiation report.

In addition to the initiation report a continuation trade report, which is a position valuation report, can also be produced. In practice this is only required to undertaken by the DTCC on a quarterly basis.

If required an on mass data report upload can be produced to provide historical data.

There are some 50 trade related data fields that are associated with the transmission to the DTCC these include; Transactions type, USIPrefix, USIValue, Buyer and Seller Ref, Verification Type, Confirmation time & date. Contract first & last day, Notional currency etc.

Web Based Broker / Client trading and price display Portal

Based on the KB Tech suite of trading Portal modules Brokers are able to provide an easily deployable web based service for their clients enabling:

• Broker entering of prices for both internal and client viewing on either a manual basis or automatically linked to internal systems (curves)
• “On behalf of” orders entered by brokers
• Order entry by clients
• Hit and Lift by clients
• Hit and Lift by broker “On behalf of”
• Timed order options: Good Till Cancelled (GTC), Timed or Good Till End of Trading Session.
• Full or Partial Fill
• Full historic trade search
• Broker control of their client’s functionality e.g. view only, direct order and trade ability, risk management, etc.
• Automatic pdf recap generation.

Integration of Market Maker Prices

KB TECH has deployed a range of its Market Making tools to deliver the business requirements of Brokers looking to provide easy access to its markets for relevant organisations / clients that would increase liquidity and trading volume.

Having identified such liquidity provider type organisations Brokers are often faced with that organisation, whist willing to provide its prices, is unwilling to make any changes to their internal systems or deploy resource on interfacing to the Brokers trading platform / systems.

In addition to being both easy and fast to deploy the Brokers’ requirements on KB TECH’s pricing integration solution included:

• Flexibility to cater for different source systems
• Low latency
• Security
• Limit Exposure
• Risk Management

Specific examples involved a client of the Broker acting as Fuel Oil Market Maker whose internal pricing system was based on a spread sheet system with live updates across some 150 instruments, both outrights and spreads, updating every second.

KB TECHs market Making tools injected these prices into the Brokers trading platform with minimal latency together with check and control mechanisms for the Market Maker and Broker. This was undertaken with zero development overhead or operational duplication for the Broker’s client thus positively influencing its willingness to provide liquidity to the Broker.