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Corporate actions STP gets boost from new version of market compliance assessment tool

Incorporating updated SMPG guidelines, latest version of STaQS for Corporate Actions offers improved efficiency and analysis

Published on 03 Aug 2011

Corporate action announcement messages that conform to the market practices defined by the Securities Market Practice Group (SMPG) become more predictable and are easier to automate. This promotes industry-wide STP for corporate actions – an area of the back office that has historically been plagued with inconsistency and manual intervention that makes processing highly error-prone and risky.

SWIFT’s STaQS for Corporate Actions tool eases the process of evaluating, self-policing and benchmarking compliance of inbound or outbound corporate actions announcement messages with industry market practice. 

The latest version of this tool introduces new functionality that improves its efficiency and enhances its ability to give users critical insights. These improvements help users to more readily identify problems and make corrections that are so crucial to ensure high levels of STP both for themselves and their counterparties.

In line with the evolution of the global market practice published by the Securities Market Practice Group, STaQS continues to progress and shift its focus to the business usage of date, rate, period and price elements. This translates into detailed reports, with error alerts when mandatory elements are missing and warnings if unnecessary elements are included that would stop straight-through-processing of a message.

The new version of STaQS also increased the file size by 10 times to make it easier for customers to use. This larger size means more messages can be submitted in one test file; users need fewer runs and less administration of the test reports to compile meaningful statistics for analysis.

The new version of STaQS also offers enhanced information about the messages it is testing. For example, STaQS previously provided a single, simple error description when messages had to be skipped due to syntax. The new release provides better syntax error descriptions with richer information explaining why a message has been passed over. Similarly, it will provide extra warnings when it detects the presence of the type of narrative fields that tend to prevent STP. 

In addition, the new version includes a range of changes designed to improve the drill-down analysis for large volumes of messages. STaQS for Corporate Actions now reports the Corporate Action reference (CORP) assigned by the sending custodian and the Official Corporate Action reference (COAF) when assigned by a central market institution (the so-called universal identifier). It also enables drill-down analysis on messages by identifying if the message is a pre-advice of payment (or reversal) of securities and/or cash, and by detecting if the message is new, an amendment, a cancellation, an entitlement notification or a reminder.

These features add value separately but even more so if a user combines the new features for a specific, targeted analysis or uses them for cross-checking.

Michele De Boe, head of asset servicing, Securities Marketing, SWIFT, says: “STaQS for Corporate Actions is already bringing great value to users, helping them to assess the compliance of their messaging with market practice in order to push up automation rates. The new features of the latest version of the tool will increase its value further, enhancing its analytical power and reducing the time it takes to deliver meaningful information.”