In a previous post, I had described some of the challenges and implementation details of a recent payments system implementation for a hedge fund customer. You can read that post here.
This post further details the integration of our payments module (TS EFT) with Sungard's Virtual Portfolio Manager (VPM), subsequent details of netting and eventual transmission of payments, credit notices and transfers to the banks. The picture below provides an overview of the integrated system, details follow.
Sungard VPM Integration: Scheduled exports from Sungard VPM are created and uploaded to folder from which the TS scheduler pulls the data into the TS EFT module. The file imported has a list of transactions and each transaction has a unique transaction identifier and a field that indicates whether the transaction is a new one, an update or a delete request from VPM. Note that transactions from VPM can only be updated or deleted ONLY if the VPM transaction is not part of a netted EFT transaction already. If not, the EFT has to be rejected and only then will the transaction be updated or deleted.
Transaction Manager & Netting Capabilities: The EFT transaction manager lists all imported transactions and allows users to select transactions to net based on rules that can be defined per combination of fields - for example, only certain transactions maybe netted together based on multiple configurable fields (say the clearing broker and currency) from the VPM import file. As the transaction manager is completely XML driven; the product can easily be configured to support other portfolio management systems such as Advent Geneva. It can even be configured to integrate with in-house portfolio solutions.
Template Mapping: TS EFT supports creation and use of templates for all payment transaction types - note that these are templates that are independent of the banks themselves. The transaction manager also allows to map templates to end user selected mapping criteria based on data in the VPM input file. Here again, you could create and map templates - one per clearing broker and currency thereby requiring the user who nets the transactions to create the EFT to enter minimal information on EFT origination.
Payment Types: For this customer deployment, their custodial accounts are at BONY and CSFB has their prime broker accounts. Cash positioning for the custodial accounts held at BONY is done via TS CMO module and hence the need for forecasting for BONY accounts. Based, on the mapped templates or banks and accounts selected on free form transactions, the system presents the appropriate forms. The payment type selection criteria and associated transaction types for payments, notices and forecasts is described in the picture below.
A note about SWIFT for transmission: Our customer choose to utilize SWIFT for transmission to the banks (CSFB only, we communicate directly with BONY). It should be noted that if the payment bank supports secure transmission via FTP and since Treasury Sciences EFT supports standard formats such as ISO 20022 and SWIFT MT files, you do not need to use SWIFT only for transmission- it may not be cost effective.
I will describe some of these features using screenshots from the application in a later post. Thank you for reading.