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Freeing up liquidity and aiding regulatory compliance

Inefficient claims management puts a squeeze on a bank’s resources, including liquidity.

Firms can have as many as 20,000 open items a month, per type of claim. Largely due to the high degree of manual processing involved, 30% of these fail to settle on the contractual settlement date - with actual settlement occuring, on average, ten days late.

The costs to the business are substantial

Money tied up in the claims process requires expensive capital to be set aside against the counterparty risk, and also incurs funding costs. For large firms, these can run to USD 2 million annually, and can even put a strain on liquidity.

SetClaim: free up your liquidity

Unlock liquidity? With SetClaim you can.

Euroclear’s SetClaim is an automated solution that tackles these issues head-on. We ensure fast and efficient claims matching with external counterparties and inter-company.

Automating claims processing improves your liquidity management, allowing you to:

  • Unlock cash – speed up your receipt and payment processes and reduce funds held against outstanding payables. This will free up liquidity for use elsewhere and cut the costs associated with holding it.
  • Reduce your capital cost – reduce the cash tied up in the claims process to release capital and help you make better use of your balance sheet.
  • Cut the volume of payments – bulk and net claims to cut payment costs and transaction fees.
  • Improve oversight – access a wealth of liquidity management information, from the profitability of individual client accounts to the global oversight of exposures.
  • Meet regulatory requirements – ensure funds are available more quickly, helping you comply with regulatory requirements, e.g.the EU’s Capital Requirements Directive (CRD).

Simplifying regulatory compliance

New regulations in the US and the UK requiring reporting on claims have also made the need for automation more urgent.

 

Regulation What it requires How SetClaim helps
In the UK, Client Asset Sourcebook (CASS) Requires firms to ring-fence funds against client money held (including claims) with strict reporting requirements. SetClaim automates the issuing, tracking, chasing and reconciliation of outstanding claims.
In the US, Financial Stability Board initiatives, e.g. Abandoned Property / 15.C(3) Requires firms to maintain an audit trail of their efforts to settle outstanding claims. It provides a ready-made audit trail to facilitate compliance with both regulations.

Quick win

SetClaim is easy to implement and the savings it achieves ensure a rapid pay-back on the investment.

To get a free business case analysis based on your current claims activity, contact your Relationship Manager or Nathan Hunt at:

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Contact us

Find out more about how you can get started using SetClaim, contact:

Nathan Hunt
+44 (0)207 849 0463
nathan.hunt@euroclear.com

 

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