A BATTLE IS under way throughout the financial services industry to remove the human touch from trade processing. After at least 20 years chasing this hallowed goal, it seemed the industry was close when the Securities Industry Association (SIA) stipulated that straight-through processing had to be sufficiently perfected to ensure T+1 - trade plus settlement on the following day - by 2005.
But that has proved to be an unrealizable target, and the race to T+1 has been indefinitely postponed. Progress is far from guaranteed. "Without a specific collective deliverable or imperative to demonstrate improvements within a specific timeframe, it's sometimes a struggle to see what we will be able to achieve," says Jane Levi, member of the operations strategy and development group at Dresdner Kleinwort Wasserstein. "The whole industry is torn between needing to make progress and to change today, whilst knowing that the tools to help them, like interoperability or standards convergence, won't be ready for another 18 to 24 months."
The development of industry-wide STP has in part been dogged by the lack of interconnectivity. The dawn of the e-age brought with it an unbridled enthusiasm for automating business processes, which meant every bank and its counterparty, where the resources were available, set about writing numerous software programmes to remove the paper flow in their different businesses.