LEI Readiness – Instant Integration with Alacra Concordance
The idea of an LEI pre-dates the 2008 financial crisis by several decades. The ISO (International Organization for Standardization) had advocated an LEI (at one time called the IBEI – International Business Entity Identifier) for many years, but was unable to pinpoint an organization ready to build and maintain such a directory. For many securities industry participants, existing identifiers, such as the Bank Identifier Code (BIC), met most of the market’s needs.
The collapse of Lehman Brothers revealed the problems firms faced in readily identifying their counterparty exposure. With critical data residing in multiple, unconnected silos, many firms had no way to calculate their counterparty risk across front, middle, and back office systems. This damaged reputations, led to tremendous financial losses, unleashed law suits, and brought into focus the dire need for a system to uniquely identify entities.