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Transaction Reporting Framework for MiFID

Challenges we address

Markets in Financial Instrument Directive II (MiFID II) — legislation published by the European Commission in October 2011 — requires global financial institutions to periodically review and report on their processes and business operations — a move that dramatically changes these institutions’ operating models. MiFID transaction reporting is a challenging task that involves handling diverse securities transactions and business processes within a bank, generally occurring across a multitude of applications spread across many systems, and each with its own processing rules. Organizations need services that allow them to reuse and combine the functionality embedded in existing applications with the new functionality to deliver composite applications that meet MiFID requirements. This entails defining a business-process-management framework, which defines new end-to-end processes with business functions encapsulated in services, rather than focusing on customizing applications. Most important, given that the MiFID directives are evolving and new rules and regulations are likely to be introduced, the services must be agile and robust.

What you can expect

HCL’s SoA-based enterprise architecture can help global financial institutions meet the MiFID II reporting requirements. It is a framework that can deliver agile and flexible solutions addressing ever-changing business needs. An abstract view depicts it as a layered architecture of loosely coupled services that align with business processes. This clear separation of concerns provides unprecedented flexibility to plug in new services or upgrade existing ones. It can also expose existing enterprise applications as services, thereby safeguarding IT infrastructure investments. The business process flows are supported by the choreography of these exposed services into composite applications integrated through an Enterprise Service Bus (ESB).

Other key features of this framework:

  • A data-filtering mechanism for cleansing trade data obtained from multiple systems. This helps add instrument classes from different trade data systems and handle feeds from source systems both in batch mode and in real time.
  • A rules engine to pick up the right trades for transaction reporting to ensure transparency in the application of business rules, along with mechanisms to view the processing logic and rules that were applied
  • Flexibility: a single gateway for external connectivity to reporting mechanisms or direct regulatory reporting
  • The use of standard messaging formats for external notifications
  • The best infrastructure with a best-of-breed rules engine and servers with secondary standby capacity
  • Scalable infrastructure to handle volume spikes and separation of databases by business services
  • Business-process-performance monitoring through a dashboard that includes measuring and generating management reports to assess efficiency. Key aspects considered include accuracy, throughput, time taken, outage, and number of errors
  • Services that can easily be shared across applications

Business Benefits

  • Modular approach – easily add types of instruments and reporting mechanisms
  • Ability to cater to increased business volumes
  • Consolidated engine to handle all types of transaction reporting
  • Centralization of business rules from a transaction reporting perspective
  • Improved understanding of the whole reporting framework via a management console

Case Studies

What Customers say

“We chose HCL as a strategic partner to help us manage our existing applications and implement new technologies. HCL has been responsive to the needs of the IT group and our customers, and has been committed to delivering high-quality services with a level of flexibility required by our business."

- CIO, Fortune 15 insurance company


"Our bank won many of the most important IFR awards, including Bond House of the year, Interest Rate House of the year, and the overall Derivatives House. You played a key part in this achievement."
Global Head, Rates, leading global investment bank