Easier Regulatory Compliance


Since the financial crisis, transparency, investor protection, conduct and risk mitigation are the overriding themes in global regulation.  Many firms are addressing the new regulations tactically – simply to be compliant. However, firms that strategically create new compliance workflows are gaining valuable insights into their business that reduce risk and drive investment performance, strengthen relationships and increase revenue and profitability.

Point of View

Meet Requirements and Deliver Proof

Viewing compliance as a cost of doing business ignores that the data generated from being compliant is a powerful, invaluable asset – giving firms a competitive edge.

More and more buy and sell side institutions have zero tolerance for post-trade errors because of the amount of fines levied by regulators and effects that damaged reputations have on relationships and mandates. Firms not only need to achieve compliance but demonstrate that policies and disclosures are accurate and followed. This creates tremendous pressure on the quality and provenance of data, the performance of quantitative models and the speed and accuracy of reporting, both to regulatory bodies and the public.

Bloomberg Trading Solutions OMS platforms’ technology and workflows are specifically designed to make compliance a fully integrated part of the investment life cycle. Comprehensive rules engines are integrated with Bloomberg’s world class data and quantitative analytic valuation (BVAL) services. The access to these extensive datasets enables the engine to be adapted for any business model to prevent compliance errors across the investment life cycle, especially before the execution process even starts.. For example, credit risk tools enable compliance officers to monitor real-time exposures in a single blotter, manage exceptions centrally and set hard and soft limits for exposures to specific industries, instruments, sectors or regions. Additional rules can be constructed for the execution process and post-trade operations to monitor factors that may affect best execution, conduct and risk.

Regulatory initiatives for transparency, best execution and investor protection are creating new post-trade operations compliance obligations. On the sell side, more and more OTC asset classes are subject to trade reporting requirements. At the same time, regulators are narrowing the trade-reporting window. Bloomberg Trading Solutions provides sell side firms with a ticketing workflow and a sophisticated reporting rules engine to validate data and prevent over-reporting and comply with TRACE, LSE, Swiss and other trade reporting regulations.

Bloomberg Trading Solutions also provides transaction-reporting services again with a sophisticated rules engine to nourish reports with the appropriate static and Bloomberg security data, pre-validate reports and prevent over-reporting. The platform is a registered ARM with the UK’s FCA to help firms comply with transaction reporting obligations under the EU’s MiFID I. Additionally, firms can transaction report to Canada’s IIROC. The platform is being enhanced to manage MiFID II requirements.

The regulatory reporting platform provides compliance officers and operations staff with a blotter-based workflow to centrally supervise, monitor and manage the status of reports, pre- and post-reporting exceptions.

Bloomberg Trading Solutions informs clients of regulatory changes to the trade and transaction reporting and manages all the updates when regulatory reporting destinations make changes to either code or enhance reporting requirements.

Although trade and transaction data are regulatory reporting requirements, they are also highly valuable assets. This data can provide compliance officers, CIOs, CEOs, CFOs and managing directors with insights into business profitability and relationships. For example, the data can be easily integrated into Bloomberg’s quantitative Transaction Cost Analysis analytics for best execution benchmarking and trade investigation and reconstruction capabilities for market abuse identification investigation and resolution. This integration can provide firms with a strategic approach (workflow) that addresses all the post-trade and operations compliance regulations.