DTCC introduces real-time trade-matching service

The New York-based Depository Trust and Clearing Corporation (DTCC) has introduced real-time trade-matching (RTTM) services for corporate and municipal bonds and unit investment trusts (UITs), a move it called a significant step in the industry’s progression towards straight-through processing.

Corporate and municipal bonds and UITs are now processed by a subsidiary of the DTCC, the National Securities Clearing Corporation.

The Fixed Income Clearing Corporation (FICC), another subsidiary of the DTCC that led the effort to roll out RTTM, said it provides all customers with a common processing platform and a standardised message format for the US fixed-income markets.

The products, the last in the fixed-income family to be offered with RTTM, can now be traded with reduced execution and settlement risk as well as costs, the FICC said. It allows greater volumes to be matched on a trade date and lets firms fix processing problems the same day as an error occurs, it added.

Fixed-income products constitute in excess of $2 trillion a day in trades, the FICC said. Approximately 250 firms are submitting corporate and municipal bonds and UIT transactions to FICC’s RTTM service, it added, with an average daily volume of $13 billion. It said 97%, or $1.8 trillion, of US government securities and 74%, or $211 billion, mortgage-backed securities are now submitted in real-time.

Tom Costa, the FICC’s president and chief operating officer, said RTTM would assist the industry’s business continuity efforts. “Real-time reporting and the safe storage of data translate into rapid recovery of data to the point-of-failure in the case of major business disruption or a power outage such as the one we experienced last summer,” he said.