OTAP Corporate Actions Implementation
Corporate Actions Processing Challenges
Corporate actions processing is one of the most complex and risk-prone areas in securities operations. Financial institutions face significant challenges in managing the diverse range of events, data quality issues, and complex processing rules while ensuring regulatory compliance and timely client communication.
Complex Event Processing
Corporate actions span numerous event types from simple dividend payments to complex mergers, rights issues, and tender offers, each requiring specific handling rules and calculations.
Data Quality Risks
Multiple data sources with varying formats and timelines create significant reconciliation challenges and operational risks if events are missed or incorrectly processed.
Regulatory Pressures
Increasing regulatory scrutiny requires robust audit trails, accurate client reporting, and timely notifications that meet jurisdiction-specific requirements.
High Processing Costs
Manual processing of corporate actions is labor-intensive, error-prone, and costly, creating a strong business case for automation and STP.
Corporate Actions STP Flow
OTAP implements end-to-end automation for corporate actions processing, creating a seamless flow from announcement capture to entitlement processing:
Announcement Capture
SWIFT MT564/568 intake with scrubbing
Event Creation
Mapping to system event types
Position Identification
Determining eligible securities positions
Notification & Election
Client communication and choice capture
Entitlement Processing
Calculation and posting of proceeds
Corporate Actions Platforms
OTAP specializes in implementing and optimizing the leading corporate actions processing platforms. Our expertise spans multiple technologies, with particular focus on TCS BaNCS and Temenos T24/Transact Corporate Actions modules:
SWIFT Message Processing
Our implementations focus on automating the processing of key SWIFT message types for corporate actions, providing complete STP from announcement to entitlement calculation:
MT564
Corporate Action Notification
Automated intake and processing of announcements, including event creation, validation, and enrichment from multiple data sources.
MT565
Corporate Action Instruction
Processing of client instructions for elective events, with validation against event parameters and position holdings.
MT566
Corporate Action Confirmation
Generation and processing of confirmations for completed corporate action events and entitlement distributions.
MT567
Corporate Action Status and Processing Advice
Automated processing of status updates for instructions and elections, with exception workflow triggers.
MT568
Corporate Action Narrative
Handling of supplementary information for corporate events that contain narrative details beyond standard formats.
Our Corporate Actions Implementation Services
Success Stories
Global Custody Provider Implements BaNCS Corporate Actions STP
A leading global custody services provider needed to implement a fully automated corporate actions processing solution to handle high volumes of events across multiple markets. OTAP consultants were engaged to implement the TCS BaNCS Corporate Actions module with complete STP capabilities.
OTAP's Approach:
- Implemented comprehensive SWIFT message intake and processing for MT564, MT565, MT566, and MT567 messages
- Configured sophisticated data cleansing and scrubbing rules to handle inconsistencies in announcement data
- Established mapping rules for a wide range of corporate action event types
- Implemented automated reconciliation against multiple data vendors
- Created custom templates for client notifications based on event types and client preferences
- Configured automated entitlement calculations with multi-currency support
- Developed an exception management framework with prioritization based on event criticality
Results:
- Successfully automated processing for high volumes of corporate action events
- Achieved significant straight-through processing improvement for mandatory events
- Reduced event processing time substantially
- Implemented support for multiple markets with their specific event processing requirements
- Enhanced client service with timely event status updates and accurate notifications
- Reduced operational risk through automated controls and validations
European Bank Group Enhances Temenos Corporate Actions Processing
A major European banking group with operations across multiple countries needed to optimize their corporate actions processing within their existing Temenos T24 environment. The bank required a solution that would standardize processing across all entities while supporting country-specific requirements.
OTAP's Contribution:
- Led the configuration of the Temenos T24 Corporate Actions module across multiple bank instances
- Implemented standardized event processing workflows for consistent handling across all entities
- Configured SWIFT message processing with comprehensive validation and data enrichment rules
- Developed custom processing for country-specific tax treatments and regulatory requirements
- Created centralized announcement management with entity-specific distribution rules
- Implemented automated reconciliation between custody records and corporate action entitlements
- Configured comprehensive audit trails and control reports for regulatory compliance
Project Outcomes:
- Achieved standardized corporate actions processing across all banking entities
- Reduced manual touchpoints through automated processing
- Improved data quality with centralized announcement capture and validation
- Enhanced client service with timely and accurate event notifications
- Reduced operational risk through standardized processing rules
- Enabled efficient handling of complex voluntary events with automated election processing
- Streamlined regulatory reporting with consistent data capture across all entities
Investment Services Provider Implements Cross-Border CA Processing
A leading investment services provider specializing in global custody needed to enhance their corporate actions processing capabilities for cross-border securities. The client engaged OTAP to implement a solution using TCS BaNCS that could handle the complexities of multi-market corporate events with varying market practices.
OTAP's Approach:
- Configured BaNCS Corporate Actions module with market-specific processing rules
- Implemented advanced SWIFT message intake and scrubbing for announcements from multiple sub-custodians
- Created sophisticated event matching and consolidation logic to handle duplicate announcements
- Developed automated market deadline tracking with proactive notification workflows
- Configured complex entitlement calculations supporting multiple currencies and tax regimes
- Implemented client-specific notification rules based on holdings and preferences
- Created comprehensive operational dashboards for event monitoring and risk management
Results:
- Successfully implemented processing for multiple markets with their specific requirements
- Achieved automated consolidation of announcements from multiple sources
- Reduced processing time for complex events
- Enhanced client service with accurate and timely event notifications
- Improved operational efficiency with proactive deadline management
- Reduced missed events and processing errors
- Created a scalable platform that supported business growth without additional headcount
Retail Banking Group Implements Corporate Actions for Wealth Management
A retail banking group with growing wealth management operations needed to enhance their corporate actions processing capabilities within their Temenos T24 environment. The bank required an integrated solution that would provide end-to-end automation while supporting their diverse client base.
OTAP's Contribution:
- Configured the Temenos T24 Corporate Actions module with focus on wealth management requirements
- Implemented SWIFT message processing with automated event creation and position identification
- Developed client segmentation rules for tailored notification and processing workflows
- Created automated entitlement calculation with tax considerations for various client categories
- Configured integration with portfolio management and accounting modules
- Implemented client reporting templates with clear presentation of corporate action impacts
- Developed operational dashboards for monitoring event processing and client elections
Project Outcomes:
- Successfully implemented end-to-end corporate actions processing for wealth management clients
- Achieved high level of automation for mandatory events with streamlined processing
- Enhanced client service with personalized notifications and clear election options
- Improved operational efficiency with reduced manual intervention
- Created a scalable platform supporting growing security product offerings
- Enabled comprehensive audit trails and control reports for regulatory compliance
- Reduced processing errors with automated validation and reconciliation