Prior to Aberdeen Asset Management’s £11bn merger with Standard Life, Aberdeen Unit Trust Managers Limited (AUTM) was already live on Calastone’s settlement service. Following their adoption of the solution, Standard Life Investments now also benefits from fully automated, electronic straight through processing (STP).
As Europe’s second largest asset manager, Aberdeen Standard Investments, encompassing both AUTM and SLI, joins some of the world’s largest fund managers in adopting Calastone Settlements, significantly extending the coverage of the solution.
As trading volumes grow, the operational challenges of managing post trade reconciliation continue to increase. Additional costs will be incurred in settlement due to the financial provisions required to cover all settlement payment flows, tying up operating capital and reducing liquidity. In using Calastone’s net settlement solution, clients can overcome these challenges.
Calastone Settlements is the only commercial settlement system designed specifically for the funds industry. The solution automatically matches trades and calculates the net settlement position between each trading counterparty. Settlement payments are automated and transacted net, resulting in significant liquidity savings. As such, Calastone’s net settlement solution can generate reductions in settlement payments of up to 58%*.
Mike Tumilty, Director of Operations at Aberdeen Standard Investments, commented;
“Aberdeen Standard Investments are committed to leveraging technology to improve process, product and client experience. With Calastone Settlements we recognise that further efficiencies can be realised by taking advantage of this automated net settlement solution, which has already been deployed in other parts of our organisation.”
Commenting on the announcement, Jon Willis, Chief Commercial Officer at Calastone adds;
“We’re thrilled to welcome Standard Life Investments onto our Settlements solution. Reducing the frictional cost of trading mutual funds, and lowering the total cost of ownership is becoming more important as the funds world develops and expands. Calastone Settlements addresses several issues that our clients face, and enables significant liquidity improvements through the automated matching and netting of trades. This plays a key role in allowing our client to improve operational efficiency.”
* Analysis from 2016 Calastone & IMA trading data between fund managers and distributors