Telefónica and IPC Systems collaborate to offer Trading Solutions

Telefónica, a worldwide leader in telecommunications and IT services, and IPC, market leader in trading communications solutions, today announce that they have signed an agreement to jointly offer trading communications solutions.

This alliance with IPC is part of the Telefónica strategy to offer a vertical services portfolio that covers the specific needs of financial institutions. Telefónica widens its portfolio by offering the state of the art trading solutions of IPC which are based on open standards and IP technology, ready for the current requirements for SIP integration and Next Generation Networks connectivity.

IPC reinforces the collaboration with Telefónica, strengthening the position in key countries by leveraging on the assets of Telefónica. The first phase of the agreement includes offering voice trading solutions to the market in Spain, Portugal; where Telefónica would be the exclusive distributor of the new Unigy Solution; to collaborate to develop business in several countries of Latin America (México, Argentina, Colombia, Perú) and to jointly propose global trading solutions to several multinational strategic customers.

Clients will benefit from voice trading solutions based on the IPC technology, which is used by top financial institutions around the world. These solutions are designed to meet global regulatory challenges and help trading firms to transform their workflow. They will also be able to take advantage of the position of Telefónica as a global IT and communications provider and will be able to have global integrated solutions that cover all their communications needs.

“IPC’s primary goal is to provide sophisticated trading communications solutions and expertise that grants clients a competitive advantage in every stage of the trade lifecycle. Products such as our Unigy platform enable us to do so by making the entire trading ecosystem more productive, secure and efficient,” said Joe Smolarski Senior Vice President, Trading Communications Systems Sales & Support, IPC. “We look forward to working with Telefónica to allow customers to benefit from the combination of IPC’s trading industry expertise and Telefónica’s communications solutions leadership.”

 

“This agreement allows us to provide world-class solutions that cover the trading needs of financial institutions and enable them to stay ahead of global markets requirements. By addressing these customers IT and communications needs, we help them to focus on their business and strengthen their competitive position.” said Juan Carlos López Vives, President of Telefónica Global Solutions. “Furthermore, the global market reach of both companies is an added value for our Multinational clients and an excellent growth opportunity for IPC and Telefónica, collaborating to jointly develop business in the markets in which we operate.”

About IPC

IPC is a leading global provider of specialized communications solutions for the financial trading community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications/application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions, trading communications infrastructure management and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 700 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has approximately 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions. For more information, visit www.ipc.com.

About Telefonica Global Solutions

Telefonica Global Solutions manages globally the multinational, wholesale and roaming business within the Telefonica Group. Global Solutions delivers integrated fixed, mobile and IT services to some of the world’s top multinationals and corporations. It also provides global telecommunication services for fixed and mobile carriers, ISPs and content providers. Telefonica Global Solutions develops an integrated and competitive portfolio for carriers and corporations that include international voice, IP, bandwidth capacity, satellite services, mobility and global solutions, with service reach in more than 170 countries. Global Solutions is a multicultural organization, with more than 1400 employees, working in over 40 countries and speaking more than 15 languages.

IPC Systems Inc., announces strategic partnership with Velocis Systems in India

IPC Systems Inc., a leader in specialized communications, has announced their partnership with Velocis Systems, an established IT Solutions and Services organization with a presence in over 80 locations throughout India. This partnership strategically merges IPC’s state-of-the-art unified trading floor voice communication solution, UNIGY, with Velocis Systems’ extensive experience in providing IT solutions and services and affiliations within the financial districts outside of the main financial centre of Mumbai.

“By working with such a strong partner, it will allow IPC to extend our product and services outreach beyond our core market of Mumbai. We will be able to reach out and support potential customers across the whole country,” says David Dodd, Senior Vice President and Managing Director, APAC of IPC Systems, Inc.

With 17 years of experience, Velocis Systems builds and maintains critical IT infrastructure for over 200 clients in various industries that include Indian corporations, multinationals, as well as government institutions. Velocis Systems has more than 600 technical professionals with diverse skills in computing, data, voice, video, and enterprise management technologies and has strategic alliances with global leaders such as HP, Microsoft, Cisco, CA, and Polycom.

“Velocis Systems is pleased to be partnering with IPC as they expand their presence across India. IPC is a company that continues to innovate and lead the industry with their UNIGY trading floor voice communication solution. This leadership combined with Velocis Systems reach in major Indian financial markets will prove to be a valuable partnership in the years ahead,” states Mr. Jignesh Rachh, Director of Velocis Systems.

About IPC

IPC is a leading global provider of specialized communications solutions for the financial trading community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications / application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 630 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has approximately 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions.

IPC Commemorates a Decade of Leadership in Annual FinTech Rankings

IPC Systems, Inc., the leading global provider of specialized communications solutions for the financial services community, has been named a top provider of financial technology to the financial services industry in the annual FinTech Forward (an initiative including the FinTech 100), published in collaboration between American Banker and BAI. It is the tenth year in a row the company has been ranked.

The ranking of the top 100 global technology providers is based on percentage of revenues from sales to financial services clients. In a testament to the company’s stability and importance to the industry, IPC ranked 32nd on the 2014 list of financial technology companies.

IPC is a leader in the financial services industry, providing trading solutions, network connectivity, and managed services to organizations of all sizes across the globe. Historically, financial services firms have attempted to find a balance between maximizing the return of investment from their legacy systems and deploying the most advanced technology in order to gain competitive advantage. In order to ease the burden on financial services firms, IPC developed technology bringing next-generation products and decades of expertise to their customers, incorporating interoperability with existing systems while helping firms transform their workflow. IPC enables traders using IPC technology to be significantly more productive and connected than ever before, while making their operations much more profitable.

In addition, changes across market structure, the regulatory environment, and business models in the wake of the 2008 financial crisis created an unfamiliar environment for financial services firms. This includes new trends such as BYOD policies and more stringent voice recording requirements. To meet the needs of its customers and help them achieve compliance, IPC provides a comprehensive suite of innovative products and managed solutions.

IPC accounts for more than 118,000 of the world’s trading turret positions. Unigy®, IPC’s market leading next generation unified trading communications platform, is designed to speed collaboration between traders and the trade support teams across middle and back offices with unprecedented flexibility, scalability, and adaptability. IPC’s Financial Markets Network solution portfolio includes the Connexus private extranet, DirectConnect and Managed MPLS VPN data services, as well as Trader and Enhanced IP voice connectivity solutions. IPC’s Financial Markets Network interconnects global financial centers and allows access to more than 5,000 participants in over 700 cities in nearly 60 countries. Built on a state of the art IP/MPLS infrastructure, the highly scalable and secure Connexus Extranet supports a number of industry standard and trading protocols. IPC provides managed service solutions through its Enhanced Services division and is one of the most trusted and progressive service providers to the global financial community. Capital markets firms rely on IPC Enhanced Services to provide compliance and risk oversight, manage and monitor their trading communications technologies, project manage critical initiatives and advise and assist in business transformation.

“The financial markets are constantly evolving, always searching for better ways of doing business and evolving to meet new challenges. IPC’s goal is to provide our customers with the technological tools to stay competitive and maintain their edge in the trading arena, and our method has always been to research and create the solutions that enhance the trader’s edge,” said Michael Speranza, Senior Vice President, Managing Director, Trading Communication Systems. “Our continued inclusion on the FinTech list is a true testimony by our global customer community that IPC’s advanced technology, dedicated service, and persistent innovation continues to exceed their needs.”

About IPC

IPC is a leading global provider of specialized communications solutions for the financial services community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications/application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions, trading communications infrastructure management and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 700 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has over 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions.

IPC Appoints Neil Barua as Chief Executive Officer

IPC, the leading provider of specialized solutions for the financial services community, today announced the appointment of Neil Barua as Chief Executive Officer, effective immediately. A veteran of the telecom and financial industries, Mr. Barua had been serving as interim CEO of IPC since February 2014.

Previously, Mr. Barua was an Operating Partner at Silver Lake, the global leader in technology investing, and will remain part of the Silver Lake extended community as CEO of one of its portfolio companies.

“I am excited and honored to join IPC as Chief Executive Officer,” said Mr. Barua. “During my time at IPC, I have developed tremendous respect for the people at this company and how we serve our customers as a trusted partner. I’m thrilled to accelerate our current momentum and provide superior trading and connectivity solutions to our customers.”

 

“Neil has done a tremendous job at IPC in his interim role, and we couldn’t be more pleased to have him lead IPC into its next phase of growth,” said Greg Mondre, Managing Partner at Silver Lake.

Mr. Barua previously served as Operating Advisor at private equity firm Francisco Partners. His management experience includes his role on the executive leadership team that took telecommunications company Global Crossing through a restructuring and consequent sale to Level 3 Communications. Mr. Barua held several leadership positions at Global Crossing around the world, including Managing Director of its $700 million+ enterprise services division, where he led the team to significant growth. Before Global Crossing, Mr. Barua worked at Asia Global Crossing in Hong Kong and was a key participant in its $400 million initial public offering.

About IPC

IPC is a leading global provider of specialized solutions for the financial services community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications/application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions, trading communications infrastructure management and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 700 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has approximately 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions. For more information, visit www.ipc.com.

IPC Celebrates Ten Years of Leadership with “Best Trading Floor Communications System Provider” Award in Annual Waters Rankings

IPC Systems, Inc., the leading global provider of specialized communications solutions for the financial trading community, has once again been voted “Best Trading Floor Communication System” provider in the Waters Rankings. IPC has won the best trading turret provider category in the Waters Rankings in six out of the seven years the category was on offer: 2004, 2005, 2006, 2008, 2009 and 2010. In 2011, the best trading floor communication system provider category superseded the best trading turret provider category, although the result in this category was the same – IPC won the category in 2011, 2012, 2013 and now again in 2014.

“Since 2004, it has been our great honor to be recognized by industry leaders and experts as the best trading floor communications system provider,” Michael Speranza, senior vice president, managing director, Trading Communications Systems, IPC, said. “Our global customer community continues to affirm that when it comes to meeting their needs, IPC’s advanced technology, dedicated service, and continual innovations are of timeless value.”

IPC accounts for more than 118,000 of the world’s trading turret positions defining the Company as the turret market segment leader with over 50% share. Unigy®, IPC’s market leading next generation unified trading communications platform, speeds collaboration between traders and the trade support teams across middle and back offices with unprecedented flexibility, scalability, and adaptability. Unigy’s interoperability allows it to work with existing systems such as IQ/MAX turrets, PBX phone systems and voice recording equipment to help trading firms of every size transform their workflow, making traders significantly more productive and their operations much more profitable. Unigy is live at more than 660 customer sites globally, including installations at more than 50% of the 2013 Top 25 banks*.

“For the last decade, Waters magazine has turned to its expert reader base to determine which vendors lead in their respective fields for the annual Waters Rankings. Waters readers have selected IPC as Best Trading Turret Provider and Best Trading Floor Communication System 10 out of 11 times these awards have been given out,” said Anthony Malakian, US editor, Waters.

 

“Our primary goal is to provide our customers with top-of-the-line technology that grants them a competitive advantage in every stage of the trading lifecycle,” said IPC’s Speranza. “We strive to help our customers do their jobs more quickly, effectively and efficiently, and we are privileged to receive their confidence that we are the best trading floor communication system provider. This honor reinforces our commitment to developing cutting edge solutions that meet their collaboration and trading needs.”

The Waters Rankings are the annual readers’ choice awards of Waters magazine, which recognize the combined leadership of technological capabilities and human expertise in each category. Qualified voters from buy- and sell-side firms as well as exchanges and inter dealer brokers. More than 1,000 voters chose the best financial IT solution and services in the annual Waters Rankings.

*The Top 25 banks of the Top 1000 World Banks ranking is generated by The Banker Database, and published in The Banker July edition.

About Waters

Each month, Waters reports and analyzes the practical implementation of financial technology in the wholesale banking and securities industries. Since its launch in 1993, financial IT professionals worldwide have relied on the magazine for its focused, in-depth coverage of financial market data and technology as well as the human issues of talent management, staff retention and compensation within the financial services community. With more than 10,000 subscribers, Waters readers enjoy the insights of CIOs and CTOs from the global capital markets. Waters is published by Incisive Media Plc. For more information, please visit www.watersonline.com and www.incisivemedia.com.

About IPC

IPC is a leading global provider of specialized communications solutions for the financial trading community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications/application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions, trading communications infrastructure management and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 700 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has approximately 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions.

ATMonitor Talks with IPC’s Ganesh Iyer

What impact will the new regulatory requirements have on firms trading OTC derivatives and are they well prepared?

Even though it has been nearly five years since the G20 first proposed initiatives to mitigate systemic risk, reduce operational inefficiencies and promote transparency in the global OTC derivatives market, practitioners believe the industry is still evolving and remains unprepared. The impact of the Dodd-Frank Act and European Markets Infrastructure Regulation (EMIR) is being felt by market participants in the US and Europe respectively, particularly the mandate of executing all derivatives subject to a clearing obligation on a regulated market, swap execution facility or organised trading facility.

The four key proposals of global regulators include:

  • Increased standardisation of products
  • A move to central clearing
  • Promoting trading on electronic platforms
  • Reporting to trade repositories.

Standardisation of products results in greater liquidity, improved market transparency, more reliable pricing data and better risk management. Standardisation of products is also conducive to electronic trading. However, trading in the European OTC derivatives market will follow a hybrid model with voice RFQs remaining strong for the foreseeable future. The requirements around central clearing, trading and reporting also aim to reduce risk, promote transparency and enhance market surveillance. These moves are important considering that credit default swaps were one of the major causes of the global financial crisis.

What we have done at IPC is to create a community of market participants – buy-side firms, sell-side firms, inter-dealer brokers, liquidity venues, clearing and settlement firms, market data providers and software vendors – that consume trade lifecycle applications, market data and other services from other providers in the community. And we have leveraged this community to create a swap ecosystem which includes swap dealers, major swap participants and swap execution facilities (organised trading facilities in Europe). Our ecosystem has become a magnet for market participants in the OTC derivatives asset class.

What role is London playing in the European financial services industry in terms of addressing key regulatory challenges?

We are seeing increased technology, communications and software investments in London. As it is a historical financial centre and because it is in a central time zone, equidistant between North America and the Asia-Pacific region, people look to London as the global hub of trading. It is the main centre to connect to other market participants in the EMEA region given the attractive business environment, skilled personnel, infrastructure, government responsiveness and abundant supply of professional services here. We see a lot of demand to connect to other markets in Europe – not just to the developed markets like France, Germany, Spain, Italy and Scandinavian countries but also emerging markets in Eastern Europe, Africa and the Middle East.

IPC has substantial operations in London as it is the primary market in Europe and a major global financial centre. IPC operates a dark fibre network in London – we have a lot of different data centres in the London metropolitan area, from Slough in the west through the Docklands and out to Basildon. We operate a robust and secure infrastructure in London for our community of market participants – the buy-side, sell-side, inter-dealer brokers, liquidity venues, independent software vendors and market data providers. We’re also continuing to make a lot of investments in the City and in the greater European trading community.

Fading Offers and Higher Prices: Front Running, or Something Else?

Rosenblatt Securities recently published a critical review of “Flash Boys,” the Michael Lewis book that has sparked explosive and contentious debates on high-frequency trading. In a blog titled “Trading Talk,” Justin Schack, managing director at Rosenblatt, offers insights into the transformation and evolution of the US equity market structure since the late 1990s. He contends that the Order Protection Rule, rather than HFT front-running, explains why the traders in “Flash Boys” that attempted to buy large blocks of stock saw offers fade and prices move higher when they placed an order:

The Order Protection Rule, passed in 2007, aims to ensure that both institutional and retail investors get the best possible price for a given trade by comparing quotes on multiple exchanges. The rule caused market markers to quote their best prices on all exchanges even though they did not want to actually sell the total amount of shares offered across all the exchanges. Once an order was filled in one exchange, market makers canceled orders at that offer price on other exchanges. In this scenario there is no HFT front-running; but just like HFT front-running, traders will witness offers fade and prices increase.

The review also argues that decimalization of the US equity markets in 2001 caused tighter spreads between the bid and ask prices of a stock (because the minimum price movement went down to $0.01 from 1/16 of a dollar). HFT firms entered the picture and started making money on penny spreads by trading smaller sizes very frequently. The argument in “Trading Talk” is that not many institutional investors or Wall Street banks would be trying to execute block trades on lit markets in the world of decimalization and algorithmic trading of small quantities of stock since it would show their hands and cause market impact. Investors would certainly see offers fade and prices move higher if they attempted a block trade on lit markets.

IPC’s Rapidly Growing Financial Market Network Empowers Market Participants to Seize Opportunities

Fueled by market participants’ needs to gain a competitive edge while meeting evolving regulatory requirements,  IPC has expanded its Financial Market Network with the addition of new liquidity and execution venues, on-net locations, core network capacity and Points of Presence (PoPs). IPC’s Financial Markets Network facilitates a comprehensive suite of mission-critical managed network solutions designed and operated to address the connectivity needs of capital markets firms across the front-, middle- and back- office.

“With the financial markets constantly evolving, firms are looking at ways to efficiently access new counterparties, geographies, liquidity venues and trading services. The infrastructure and solutions we offer enable participants to quickly connect and engage within the financial ecosystem,” said Joe Pickel, vice president, Network Services Product Management, IPC. “The activity around Swap Execution Facilities (SEFs) and the automation of OTC derivatives trading is one such example where we are seeing new regulations driving dozens of liquidity venues, buy-side firms, swap dealers, and others engaged in the trade lifecycle onto IPC’s Connexus Financial Extranet.”

SEFs including TeraExchange, as well as a number of IDBs, are available through IPC’s Connexus.

“As the OTC derivatives markets continue to evolve, it’s important for our customers to have reliable and secure connectivity to our platform,” said Leonard T. Nuara, President, Chief Operating Officer and Co-Founder of TeraExchange. “Being a part of the IPC community makes access for our customers easier.”

The Connexus Financial Extranet is part of IPC’s Financial Markets Network solution portfolio which includes private extranet, DirectConnect and Managed MPLS VPN data services, as well as Trader and Enhanced IP voice connectivity solutions. IPC’s Financial Markets Network interconnects global financial centers and allows access to more than 5,000 participants in over 700 cities in nearly 60 countries.  Built on a state of the art IP/MPLS infrastructure, the highly scalable and secure Connexus Extranet supports a number of industry standard and trading protocols.

“Global financial reform is impacting not only the trading desk, but also the technology that underpins the market,” said Kevin McPartland, Head of Market Structure Research, Greenwich Associates. “These regulatory initiatives are driving increased investment in technology across the board, including improved and expanded networking capabilities to ensure much needed access to emerging liquidity pools and new sources of market data.”

About IPC:

IPC is a leading global provider of specialized communications solutions for the financial trading community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications/application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions, trading communications infrastructure management and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 700 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has approximately 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions.

ICAP Selects IPC as Preferred Supplier of Trader Voice Connectivity Globally

IPC, a leading provider of trading communications solutions to the world’s top financial services firms, today announced that ICAP, Plc., a leading markets operator and provider of post trade risk mitigation and information services, has selected several of IPC’s Financial Markets Network services for its global connectivity needs, including Trader Voice, the Connexus Financial Extranet and the Direct Connect data service.

Leveraging IPC’s services, ICAP will have access to rapid connectivity and trading parties anywhere in the world with approximately 5,000 financial institutions instantly reachable. In addition, the company will enjoy comprehensive Business Continuity Planning/Disaster Recovery capabilities, enabling enterprise-wide survivability, mobility and flexibility.

IPC will become ICAP’s preferred global supplier of Trader Voice Connectivity, further building on a strategic partnership which also encompasses Trading Systems and Data Services. ICAP and IPC will work together to manage the seamless migration of all of ICAP’s Trader Voice circuit inventory on to IPC’s fully resilient Trader Voice Connectivity Platform.

“ICAP chose to partner with IPC because it is an industry leader providing reach, scale and geographic coverage, with the levels of network resiliency and diversity we require,” said Alan Pittard, ICAP Vendor Management. “By using IPC’s Financial Markets Network services, we gain professionally managed connectivity that enables us to provide our international clients with highly sophisticated access to financial markets across six continents.”

 

“IPC is committed to providing industry leading, value-added network solutions for traders in a reliable and secure environment,” said Barry Purkis, senior vice president, IPC. “By strengthening our strategic partnership with ICAP, not only can we enable them to connect globally with fast and efficient access, but we have created a solid foundation that underpins all future service offerings and developments encompassing on-demand cloud based solutions, electronic trading and applications.”

The IPC Financial Markets Network service portfolio includes the Connexus Financial Extranet and Direct Connect data services, as well as Trader and Enhanced Voice connectivity services. IPC’s Financial Markets Network interconnects global financial centers and allows access to approximately 5,000 market participant locations in over 700 cities in nearly 60 countries.

About IPC

IPC is a leading global provider of specialized communications solutions for the financial trading community. With a 100-percent focus on this sector and over 40 years of expertise, IPC provides customers with integrated solutions that support traders and participants across the entire trade lifecycle including sell-side and buy-side financial institutions, inter-dealer brokers, liquidity venues, clearing and settlement firms, independent software vendors, corporate finance departments, financial information exchange providers and market data providers. IPC’s offerings include a unified communications/application platform, award-winning hard and soft turrets, managed voice and data network connectivity solutions, trading communications infrastructure management and dedicated service and support. IPC’s global reach extends to more than 60 countries – including a network of 5,000 customer sites over 700 cities and an installed base of approximately 118,000 trading positions deployed worldwide. Headquartered in Jersey City, New Jersey, IPC has approximately 900 employees located throughout the Americas and the EMEA and Asia-Pacific regions.

About ICAP

ICAP is a leading markets operator and provider of post trade risk mitigation and information services.  Group companies provide services that match buyers and sellers in the wholesale markets in interest rates, credit, commodities, FX, emerging markets and equity derivatives through voice and electronic networks.  Through our post trade risk and information services we help our customers manage and mitigate risks in their portfolios.

Global Banking & Finance Review – Mobile Voice Recording

The relatively new requirements to record mobile phone conversations relating to trading transactions are giving the industry a lot to think about. The focus on compliance is stronger than ever with record fines and compliance officers having personal liability if oversight is not in place to monitor for trading transgression.

Meeting the challenge is no simple, straightforward task. Regulation requires full trade reconstructions across all channels both voice and data, to establish the facts relative to a given trade.

The first step is to record all media (instant messages, texts, email and voice), store and archive – applying specific rules for retention. The second step is to analyse all of the data and align conversation threads to specific deals. And the third is to collate and present, on request, all relevant data to regulating bodies within a rapid time frame.

Trading institutions aim for compliance in a transparent, cost effective and timely manner.

Transparency

There are differences in regulatory demands across territories, but all broadly aim for greater transparency in the way trades originate and are executed. In the UK, the Financial Conduct Authority has extended the requirements of the European Markets in Financial Instruments Directive (MiFiD) for fixed line voice recording to include all electronic communications to and from mobile devices concerned with receiving and executing client orders or transactions. This impacts traders, front and back office advisors, settlement and private banking staff, and recordings must be retained for six months.

In the US, the Dodd Frank Act of 2013 requires that, upon demand, voice and data – emails, instant messages, text messages and trade processing – relative to a specific identified trade be made available and presented. Information must be in a suitable format so that it can be reviewed to confirm that traders took appropriate action to achieve the best price at the appropriate time.

In the future, the impact of the regulators worldwide is expected to extend even further, creating a far reaching and complex regulatory reform framework with requirements impacting almost all traded entities in financial services.

Differences aside, the regulations have been laid out. And with limited benchmark cases, the interpretation of the rules can be somewhat subjective. Until companies are asked to demonstrate that they are compliant with the regulations, they cannot be certain that any particular solution used will suffice to meet the regulatory requirements. Fearing the risk involved, some have chosen to implement a policy of disallowing mobile phone use for trades altogether, but as this restricts productivity it is an unsatisfactory solution. Plus it is unlikely regulators would be satisfied that having such a policy in place equates to compliance should mobile trading still go on regardless.

Systems put in place need to be dynamic and flexible enough to change to implement new regulatory rules or adjust as required for different geographies, roles and asset types.

Cost Effective

The intent is to avoid over-compliance – which would be prohibitively expensive in infrastructure and resource – and under-compliance – which could be even more costly in fines and reputation should a solution or an approach fall foul of regulatory demands.

Most trading institutions have basic recording facilities for traders’ desk phones, and have for some time. To meet requirements for a complete series of communications that define an entire scenario – who was implicated and why – though, requires increased functionality. Making the right solution choice is not an easy task. A phased approach is likely to be the most cost-effective, as is the adoption of an agile solution that can flex to adapt to new rules over time. Companies need to understand and weigh up costs for recording, storage, analysis and presentation of the information.

Working with a vendor with experience and understanding of the business is a must. To analyse unstructured data, comprising voice and text, is difficult. The temptation is to convert voice to text. However, doing so loses the tone and pitch of the interactions and voice-to-text conversion is difficult when recordings have been made in a noisy environment.

The foundation for tools-based analysis today is based on:

  • Identifying relevant parties – authentication by number, SIM, log-on, biometrics
  • Timeline: interweaving communications by time
  • Word spotting: basic alignment of trade flow.

Using such tools helps reduce the need for manual intervention. However, substantial human resource is still required. Technology that can completely analyse meaning, nuances, subtleties and implied meanings in communications is in a formative stage and certainly cannot be relied upon 100 per cent of the time. Meanwhile understanding the significance of ‘non activity,’ such as the timing of calls, is difficult to automate.

‘Bring your own device’ (BYOD) can of course cause further problems. If the deployed auditable solution is application-based, compliance could be circumvented by the use of alternative devices that don’t have the application or OTT communications.

Once all data communications are aligned and key transaction trade flow is available, institutions are paying considerable amounts for the lawyers’ interpretation.

Timely

The demand for transparency is a clear intent from the regulators and the industry needs to be prepared. Products exist to help IT departments grappling to meet the requirements in a timely manner.

Technology solutions providers will need to continue to develop and adapt their products to meet the challenge of communications compliance. The systems provided will need to be rules orientated to adapt to change, and regional directives.

The provision of voice communication capabilities is fast becoming a commodity. It is the management of voice interactions that is critical going forward – software solutions that make the data of communications, including recorded conversations, useful and that automates the collection, organisation and analysis of the data so that connections and linkages can be made. Agility and flexibility are critical here, as is delivery by experienced teams who understand the needs and drivers of the financial trading markets.

 

IPC

IPC provides trading communications solutions to the global financial services community. IPC’s offerings include the first unified communications/application platform, award-winning hard and soft turrets, electronic connectivity services, enhanced voice services, business continuity solutions and day-to-day system management and monitoring services.