Citi has begun sending XBRL-formatted dividend announcements for the American depositary receipts (ADRs) for which it acts as depositary bank to the Depository Trust & Clearing Corporation (DTCC).
DTCC is using the announcements to update its database, consolidate corresponding information and distribute dividend information.
XBRL has been touted as a solution to notorious inefficiencies and inaccuracies in the corporate actions space. In recent years, DTCC and SWIFT have made a push to engage issuers in "tagging" corporate actions with key event data using XBRL standards. The idea is to reduce manual entry later on in the corporate actions pipeline, thereby reducing the risk of incorrect information being inputted while increasing straight-through processing. For more on that, read "XBRL: Patch or panacea?", Winter Plus 2010.
Citi says using XBRL for ADRs is a demonstration of the standard's capabilities in corporate actions processing.
"This is a significant milestone in demonstrating how corporate actions processing can benefit from a technology innovation like structured data," says Alan Smith, managing director of Citi Securities and Fund Services. "We're pleased that Citi has taken a key role in an initiative that ultimately will result in better, faster and much less expensive data for the marketplace."
Additionally, since October, Citi has been distributing XBRL-formatted dividend announcements via secure FTP to GlobeTax, also a member of the ADR pilot and Citi's appointed agent for tax relief and reclaim services for the ADRs it issues.
Citi says it has plans to expand its XBRL pilot program to other types of corporate actions announcements and into announcements by U.S.-based public company issuers.
"DTCC receives thousands of announcements from issuers and intermediaries every day," says Dan Thieke, managing director for Asset Services at DTCC. "XBRL enables us to take that information directly into our systems without manual intervention, thereby reducing risk and cost and boosting efficiency and accuracy."