The Swiss ICSD SIS SegaInterSettle has followed the example of rivals Clearstream and Euroclear in launching a mutual and hedge fund order routing and settlement service called Global Funds Services (GFS).
Howeves, SIS believes GFS is not strictly comparable with Clearstream Vestima+ or Euroclear FundSettle. It describes GFS as “the first automated service for the settlement of offshore funds and hedge funds in the world.”
The service is based on a real-time link between SIS SegaInterSettle, its various domestic and international bank participants and the transfer agents to the funds. The company plans to implement the new service in December 2006.
With the launch of GFS – Global Funds Services – the traditionally labour- and paper-intensive settlement of offshore mutual funds and hedge funds will be largely automated, says SIS.
The service is based on a real-time link between the GFS Internet portal and SECOM, SIS SegaInterSettle’s online real-time settlement system. It offers standardised settlement to ISO 15022 standards.
The service aims to simplify securities and cash reconciliation, while allowing for monitoring and overview of the status of pending orders at all times.
“Market participants were keen to further automate and standardise fund settlement, and to reduce operational risks at the same time. We are proud to be able to present this innovation to the financial market,” says Dr Robert Rickenbacher, CEO of SIS SegaInterSettle.
SIS adds that Global Funds Services will simplify other processing steps in funds settlement. For instance, it makes redundant the time-consuming postal dispatch of documents in connection with the subscription and redemption of fund units or where transfer instructions are concerned. Instead, the necessary documents and forms will be attached to the relevant instruction in electronic form.
A newly designed funds database will serve as a source of information for front and back offices. By making available up-to-date information, the funds database facilitates administrative tasks, says SIS.