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Bank Sarasin Tackles Corporate Actions Operational Risk with Aim Software

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Swiss private bank Bank Sarasin has increased its investment in Aim Software solutions, adding the company’s corporate actions data scrubbing and matching capability to an existing data management structure based on Aim’s Gain platform and supporting pricing and static data since 2002.

The bank looked at a range of corporate actions solutions to automate manual processes before selecting Aim to streamline the corporate actions process before entitlement calculations in its Avaloq core banking system.

As a data management provider, Aim offers corporate actions capture, scrubbing and matching to deliver high quality data, but does not include entitlement and election management in its corporate actions solution. Bank Sarasin has these elements in-house, but lacked scale to manage incoming data, which is where the Aim solution comes in.

According to Peter Sami, head of logistics and a member of the executive committee at Bank Sarasin, “The situation in financial markets and increasing volumes of data prompt all banks to reconsider their processes in the operations department. Manual data handling is a cost-intensive and error-prone activity that increases operational risk. Automatic capture, cleansing and scrubbing of corporate actions announcements is a good example of measures that can bring considerable quality and cost advantages to back-office operations.”

On the bank’s selection of Aim’s corporate actions solution, he says: “Aim convinced us with a clear focus on integrating the solution into an existing environment. We are aiming for a straight-through-processing rate of up to 90% of data coming from different sources. This will enable us to drastically reduce effort on the announcement capture side and invest more effort in quality control for our customers.”

Implementation of the Aim software is planned for the fourth quarter of this year and it will initially handle mandatory event processing, covering events such as dividend cash, interest payments and redemptions. These events represent over 60% of overall volumes processed by Bank Sarasin, but will be augmented through 2013 as the bank adds categories such as mandatory events with options and more obscure, less frequent event types.

Josef Sommeregger, vice president, business development and sales at Aim Software, says: “Bank Sarasin liked the Aim solution because we have a large community of bank customers in Switzerland with similar needs and we capture and deliver what these large banks need. We also position ourselves differently to some corporate actions solutions providers, looking at corporate actions as an integrated component of a larger data governance structure, rather than as a separate application. It makes sense to have corporate actions data alongside pricing data, company data and static data and this is what our customers want us to provide.”

Aim, which recently acquired ABI Informatic on the strength of its customer base and technology, began to explore the corporate actions market three years ago. Soon after, it partnered with SimCorp to sell the Aim corporate actions scrubbing and matching element with SimCorp’s entitlement and election management components. This reseller agreement continues, but Aim recognises market demand for automated corporate actions and is responding with a push in direct sales.

To date, the company has secured Bank Sarasin in Switzerland and one customer in the UK. A second UK customer is expected to move into production this year and a private bank in Geneva is due to start product testing next year. No doubt the acquisition of ABI, which increased Aim’s Avaloq user community to 10 banks and added a total of 25 European customers to its roster, will provide fertile ground for further customer conversion.

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