What is CD/OT (UK FATCA)?

By: Justin Meagher

Regulatory Solutions group_opt3

In October 2013, certain British Crown Dependencies and Overseas Territories (CD/OT), also known as UK FATCA, entered into an intergovernmental agreement (IGA) with the UK to exchange tax information. CD/OT territories include: Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Guernsey, Isle of Man, Jersey, Montserrat, and Turks and Caicos Islands. The IGAs require similar information reporting as FATCA, but the reporting focus is on UK, rather than US, taxpayers. Continue reading

New CMA Rules Opening Doors to Foreign Investors in Saudi Arabia

By: Jad Fares

A globe on top of financial papers

In 2015, the Capital Market Authority announced rules that allow foreign investors to gain exposure to securities listed on the Tadawul, Saudi Arabia’s stock exchange. Historically, foreign money managers had to enter into swap transactions to gain such exposure. Now, with declining oil prices, the country is diversifying its economy. Its “Vision 2030” plan, a series of market and labor reforms, aims to enable the country to “live without oil by 2020”.

The Tadawul’s market capitalization is not just dominated by commodities, but has a diverse range of sector listings. To raise government revenues, a number of state-sponsored institutions could also be privatized. A key reform in Vision 2030 is to sell up to 5% of shares in Saudi Arabia Oil Company (Aramco). Saudi Arabia values Aramco at $2.5 trillion and, if fully floated, it would be the world’s largest corporation – very appealing to large, international investors and money managers.

However, these new rules present some challenges. They apply only to Qualified Foreign Investors (QFIs) with more than $5 billion in assets and a minimum of five years’ financial services experience. QFIs must be located in a third country that meets regulatory equivalence with Saudi Arabia.

Other restrictions include:

  • No single QFI can own more than 5% of listed shares of a single issuer
  • Total QFI exposure to a single issuer cannot be above 20%
  • Foreign investors cannot have exposure to more than 10% of all shares listed on the Tadawul by market capitalization (including swap exposures)

Historically, foreign investors avoided Saudi exposure because custody was carried out by domestic brokerage houses that lacked balance sheet capital and adequate risk controls. Now, an independent custody model can be used, making the market more attractive. One challenge for Saudi Arabia is that trades must be pre-funded as the market operates on a T+0 settlement time, which increases counterparty risk and makes correcting trading errors difficult.

Since the changes, trading volumes have increased slightly, and will likely pick up once Saudi Arabia is elevated to the MSCI Emerging Market Index.

Saudi Arabia’s capital markets present significant opportunities for international investors. With a local presence in the Middle East, SS&C will serve as a valuable resource for firms looking to enter Saudi Arabia and diversify their activities without taking on added operational risk.

Simplifying the Complex Investment Accounting Process at Insurance Companies

By Iwona Olszewska

Diagram on Tablet Screen

Ever increasing market and regulatory complexities facing today’s insurance firms can be a headache for asset managers who need to worry about adding new functionality to their investment management software technology, and maintaining the in-house expertise to apply these new, complicated rules to a wider range of asset classes. In addition, in order for asset managers to create accurate reports and analytics to support these complexities, they are often forced to extract and integrate data from multiple applications, or settle for a single, one-size-fits all solution that does many things, but few exceptionally. Continue reading

Global Investment Performance Standards Compliance Beneficial to Investment Firms Worldwide

By: Nancy Chirinian

financial symbols coming from hand

The Global Investment Performance Standards (GIPS) executive committee aims to establish investment industry best practices for calculating and presenting investment performance and to obtain worldwide acceptance of a single standard. The voluntary GIPS ethical standards for calculating and presenting historical investment performance have been adopted by investment management firms in at least 34 countries since first being introduced in 1999. Compliance brings with it many benefits; it allows firms to: Continue reading

Solutions Providers: More Than Simply Technology Suppliers

By: Iwona Olszewska

Business People Meeting Growth Success Target Economic Concept

Growing regulatory requirements, continual introduction of new financial products, increasing volumes of data, and never-ending cybersecurity threats demand that financial services firms choose investment accounting solutions and providers that offer exceptional expertise and flexibility. While the starting point is a proven technology platform that can quickly accommodate change, technology is simply a tool. It is the expertise and insight of the team building and supporting the tool that provide the speed and agility to accommodate new asset classes, regulations, and markets necessary to keep you competitive in the future. Continue reading

Seamless Electronic Document Processing and Workflow

By: Dennis Moore

Vector programmer working on code

The number and types of documents you are required to collect throughout the year is growing, as is the complexity of requests to deliver the information to internal and external parties in specific formats. Many firms still report that their processes are largely manual. It takes a lot of time and resources to manually manage emails and paper, re-enter and transform data into required formats for upload/reporting purposes, and manage slow approval processes. Continue reading

Reliable, Credible Hedge Fund Data Since January 2006

By: Christopher Mooney & Derry-Anne Donaghy

Computer monitor with trading software. Financial information.

Although there are a number of other industry indices, the SS&C GlobeOp Hedge Fund Index is the first independently derived and confirmed index, which ensures it is verified and does not have selection bias. The index is based on hedge funds administered by SS&C GlobeOp and excludes managed funds, daily/weekly/quarterly, funds with suspended NAVs, and fund of funds. The index includes a diverse universe of strategies. Continue reading

Automatic Exchange of Information (AEOI): A Global Initiative

By: Justin Meagher and Patti Griffin

Regulatory Solutions group_opt3

As offshore accounts become more common, tax administrators are struggling to accurately track individuals’ wealth. In the past, tax administrators relied on taxpayers to disclose their wealth in these offshore accounts, but with more countries adopting the AEOI system, that may no longer be the case. Continue reading

Smooth Operations: It’s All in the Data Details

By: Ian Searle

Diagrams projecting from tablet

Data management has always been a key focus area for asset and wealth managers. Now that more detailed and granular analysis is required, it’s critical managers have the proper tools to manage the vast amounts of information needed to run their operations smoothly and efficiently. Continue reading