DTCC automates voluntary corporate actions lifecycle

Voluntary Reorganization service is key step in eliminating manual touchpoints in the corporate actions process. 

By Richard Schwartz

The Depository Trust Company (DTC), a subsidiary of the DTCC, has successfully processed the first ever fully automated voluntary reorganization ISO 20022 instruction in the US market as part of its newly automated Voluntary Reorganization service.   

The service allows clients to manage and execute corporate action instructions around time-sensitive events in a more streamlined and efficient manner. DTCC processes over 600,000 reorganization instructions each year. 

The launch of the newly automated service following testing with Broadridge, a global fintech provider that currently services more than 60 of DTCC’s corporate actions mutual clients.  

“This is a major milestone made possible by the partnership and support of Broadridge, our clients and key stakeholders across the industry,” said Ann Marie Bria, executive director, asset services business management at DTCC. “Having end-to-end automation throughout the corporate actions lifecycle will allow the industry to utilise fixed data formats and a standardised set of rules.” 

Michael Wood, head of asset servicing, Broadridge added that the enhanced service would increase STP rates on voluntary corporate actions, reduce risk associated with manual errors and provide significant scalability and cost savings for the industry. 

According to DTCC, the corporate events process has become increasingly complicated in recent years, due to the rise in popularity of financial instruments such as securitised derivatives and structured equities that are typically backed by other securities or triggered by market conditions.