Nomura Research Institute, Ltd., a leading provider of consulting services and system solutions, today announced the availability of I-STAR/SC, an integrated ASP system for securities firms in Japan that executes standing proxy operations to overseas offices and non-resident clients. I-STAR/SC is a new function of I-STAR, an integrated back office system for wholesale securities firms such as investment banks and trust banks.
I-STAR/SC gives securities firms the ability, for the first time in Japan, to use an ASP system for custody operations. Previously, they outsourced this function to custody banks or developed a proprietary system.
Financial institutions looking to improve efficiency in their custody operations, while lowering risk, can use I-STAR/SC to meet the requirements for storing and managing investment securities on behalf of foreign investors and the company's own overseas offices, such as – securities management, account settlement management, cash dividend/principal and interest receipt management, and cash dividend receipt reporting.
"Custody operations for overseas and non-resident clients can be a tedious, time-consuming process," said Shin Kusunoki, Corporate Senior Vice President and Asset Management Systems Division Manager, NRI. "With our new I-STAR/SC offering, securities firms can lower operational risk and reduce costs, while increasing straight-through processing for further efficiency."
Some of the benefits of I-STAR/SC include:
- Significant Reductions in Total Cost of Ownership (TCO) – The TCO generated by "owning" a system, such as infrastructure management costs required to run system infrastructure in a stable manner; application maintenance costs such as operational analysis/system renovation costs required to respond to regulations; costs associated with disaster recovery site maintenance and business continuity plan formulation for possible disasters; and labor costs required to handle the above, are major financial burdens for financial institutions. By using I-STAR/SC, securities firms can expect significant reductions in these charges and expenses.
- Ability to Control Securities Settlement Internally – I-STAR/SC can control priorities of securities settlement, by providing the ability to arrange settlement with important clients and avoid fails, lowering cost and simplifying operational processes. I-STAR/SC also enables firms to set off settlement internally, among branches, which gives firms more control over their settlement compared to outsourcing custody operation to a third party.
- Conversion of Custody Operations to Straight Through Processing (STP) Through Linking to Other NRI Solutions – I-STAR/SC can seamlessly and flexibly link to I-STAR/MX (JASDEC Pre-Settlement Matching System) and I-STAR/CX (JASDEC Pre-Settlement Management System), which NRI offers to securities firms that execute settlement matching and book-entry operations. Using I-STAR/SC in combination with these services, will drive further STP, reducing operational costs and inefficiencies.
- Consolidated Management of Settlement/Balance Data in Custody Operations – I-STAR/SC handles data transfers using the SWIFT format, the standard for data linkage worldwide. In addition, it employs English as the standard language for user interfaces and can display the status of settlement/balance data directly from overseas offices, enabling the consolidated management of Japanese investment data. NRI aims to revitalize the financial market by continuing to upgrade and expand back-office solutions, improving the operations of local and foreign institutions in Japan.
- Lowering Outsourcing Fees – Securities firms who outsource custody operations and build their own systems, often experience complications when mapping operational flow. I-STAR/SC provides standardized operational flow, as well as system functionality, making it easier for securities firms to run these systems.