Support grows for automated fund processing at Euroclear UK & Ireland

London - 6 May 2009

Euroclear UK & Ireland has already attracted UK firms active in the investment fund business to process domestic fund transactions using its new, automated service that will eliminate the unacceptably high costs and operational risks associated with manual transaction processing. The firms are:

• Brewin Dolphin Ltd

• Cardale Asset Management Limited

• Charles Stanley & Co Ltd

• Direct Sharedeal Ltd

• Edward Jones Ltd

• Redmayne-Bentley Stockbrokers

Standardised order routing via the EMX Message System, followed by automated straight-through transaction settlement at Euroclear UK & Ireland, will achieve the operational savings and risk reductions needed by clients, particularly during current market conditions. In October 2008, Euroclear UK & Ireland and EMXCo launched the first phase of the service, which settles the cash leg of a fund transaction on the intended settlement date. By year-end 2009, Euroclear UK & Ireland will provide the investment fund business in the UK, the fifth largest in Europe, with its first automated settlement solution to exchange fund units for cash and vice versa.

John Beeston, Director, Group Head of Business Support, at Brewin Dolphin, said: “Brewin Dolphin’s costs of administering a unit trust holding for a private investor has been around 15 times the cost of a similar investment in an equity, and I believe the retail industry counts the cost at 20 to 30 times. I expect this Euroclear/EMXCo development to increase our efficiency, reduce our costs and expand this part of our business in the future.”

Euroclear UK & Ireland’s fund-processing service also will provide clients with an automated and centralised source of transaction information. This will be extremely helpful when reconciling fund transactions across fund registers, compared with the current practice of contacting each fund manager and registrar individually. The service will also help clients satisfy reconciliation requirements under MiFID and Financial Services Authority rules.

Euroclear also plans to integrate the fund order routing capabilities of EMXCo with FundSettle, Euroclear’s cross-border fund transaction platform, in early 2010. An important component of this initiative will be to offer clients a choice of message formats used to communicate transaction information. Clients will have the choice of using FIX (the UK standard today) or ISO standards (a more universal standard), thereby offering a syntax-neutral solution that allows clients to automatically route and settle fund transactions without needing to change their existing communications infrastructure.

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