Introduction

This case study explores how a financial services client transformed their Over-the-Counter (OTC) reconciliation processes to address challenges related to missing industry IDs, complex trade variations, and data discrepancies. By implementing an automated solution, the client was able to streamline their reconciliation workflows, reduce manual efforts,and enhance the overall efficiency and accuracy of their OTC trade management.

The Client

The client faces significant challenges in reconciling OTC trades. These trades often lack standardized industry IDs, have variations in representation across systems, and require complex reporting, which made the reconciliation process time-consuming and prone to errors. Legacy reconciliation systems were inadequate, forcing the client to rely on manual processes that introduced further risks.

The Need

The client needed a more efficient solution to automate and manage the reconciliation of OTC trades. The primary objectives were to:

• Address the lack of standardization in OTC trades, particularly FX Forwards and OTC Derivatives.
• Eliminate the need for manual processes such as Excel-based reconciliations.
• Ensure consistency and accuracy across trade representations, regardless of format or source.
• Improve overall efficiency, accuracy, and auditability in the reconciliation process.

Selecting EZOPS ARO®

The client chose EZOPS ARO for its robust capabilities in automating the reconciliation of OTC trades. The platform's advanced features included:

• Scalability and auditability: The implemented solution provides an auditable platform that could easily scale to meet the client’s growing trade volumes, ensuring seamless management of increasing reconciliation demands.
• Advanced matching rules and learning capabilities: The system's powerful matching algorithms identifies potential trade matches, learned mapping patterns for future automation, and normalized data from various file formats.
• User-driven configuration: Users were given the ability to configure their own reconciliations based on the file formats received from counter parties, reducing reliance on IT support.
• Comprehensive reconciliation functionalities: The solution included advanced features such as Auto-initiated Recons, Parent Child Recons,an Ops Dashboard, Integrated Process Automation (IPA), and Checklists to streamline reconciliation processes.

The Outcome

By adopting EZOPS ARO, the client achieved significant improvements in their OTC reconciliation process:

• Reducing in manual reconciliation efforts: Automation reduced the need for labor-intensive manual processes.
• Increased efficiency and accuracy: The advanced matching rules improved the accuracy of OTC trade matching, saving time and minimizing errors.
• Enhanced data integrity: Normalization processes improved data consistency across multiple sources and formats.
• Streamlined operations: The client achieved cost and time savings by automating reconciliation processes and shifting focus to higher-level tasks.
• Improved scalability: The client was able to scale their operations as trade volumes grew, all within a reliable and auditable framework.

Conclusion

By adopting an automated reconciliation solution, the client significantly improved the efficiency and accuracy of their OTC trade processes. EZOPS ARO scalable platform enabled seamless management of growing trade volumes, while advanced matching rules and user-driven configurations reduced manual interventions. We invite you to explore how EZOPS can help you meet or exceed your goals. Please contact us today to start the conversation.