Playing catch-up

The back office has found it difficult to keep up with front-office trading, prompting a warning by the FSA over the level of unsigned confirmations in the credit derivatives market earlier this year. Banks are now looking to improve the automation of back-office processes, and software vendors are keen to offer solutions. By Clive Davidson

When a market such as credit derivatives explodes, everyone wants to seize the opportunity and maximise trading. The front office tends to move fast and has a battery of technology to speed pricing, execution and risk management – usually all electronic and highly automated. But the back office often operates as if it were in a different era. Processes such as confirmation are, in many cases, still paper-based and manual. As a result, confirmation and settlement can take days or weeks, with the