JP Morgan and SimCorp set up front-to-back-office integration to streamline investment operations data

The integration aims to tackle costly fragmented investment and post-trade processes that contribute to operational risks such as high settlement trade fails.

JP Morgan will begin integrating its custody data onto front- and middle-office platform SimCorp Dimension with the aim of eliminating costly data inefficiencies for buy-side clients.

Through a new agreement, JP Morgan will directly share its post-trade data with mutual clients through SimCorp’s investment operations platform.

The two firms stated the integration aims to tackle costly fragmented investment and post-trade processes that contribute to operational risk such as high settlement trade fails.

“When you communicate across multiple investment and custodian platforms, there is a risk of information loss with little-to-no shared workflows. In some cases, data inaccuracy occurs because it sits separately between the buy-side and the custody platform. Or if it is not real-time and you don’t get constant messages back-and-forth about a trade status, more often than not, that creates trade fails,” Marc Schröter, senior vice president, global product management, SimCorp told The TRADE’s sister publication, Global Custodian.

“With this integration, we are trying to overcome this, by utilising all the information from JP Morgan, and vice versa, directly into SimCorp Dimension, whether it is on a transaction settlement, trade processing flow, cash and FX, tax reclaim, reconciliation etc.”

The integrated front-to-back service has gone live for one Asia-Pacific-based asset owner, and plans are to roll it out to a wider range of US and European-based clients.

The partnership is the latest by JP Morgan, which has also established front-to-back-office integrations with BlackRock Aladdin and Bloomberg AIM, two of the most-used investment operations platforms by asset managers and asset owners.

“Many buy-side firms do not have the infrastructure to collect data on the full trade lifecycle in one place. Now we are providing that custody and middle-office data elements with SimCorp Dimension. Mutual clients can stay in their platform and get JP Morgan’s interoperated data, all in the format they are comfortable with,” explained Naveen TV, managing director in securities services, JP Morgan.

“If we can give real time information and tell them what action they need to take, or don’t have to take, that eliminates a huge number of inefficiencies relating to dual platforms and dual reconciliations between our firms.”