Following the Y2K readiness dash and the hustle to get e-enabled, stock broking firms can start all over again. Initiated by the Johannesburg Stock Exchange (JSE), JSE member firms need to become "STRATE-ready", explains Richard Shaw, director of ensemble, the business and technology solutions provider for the financial market.
Shaw summarises a brief history of the initiative. "The JSE started an initiative around three years ago to achieve secure, electronic settlement of share transactions on the JSE and for trades by having the proof of exchange in the form of a share certificate (paper-based), known as a scrip, converted to electronic format. This is known as the dematerialisation of scrip. Broker firms need to convert their systems to enable STRATE (share transactions totally electronic)."
He goes on to explain the process of conversion. "The initial phase of the conversion project includes evaluating the "as is" processes and assessing current organisational structure and existing systems against the requirements imposed by STRATE. From there, `to be` processes are designed and systems are selected or developed to support the new processes, followed by the implementation of those systems, with the last phase of the project dedicated to training and testing."
According to Shaw, the `to be` processes will determine what needs to be done to enable brokers to trade using electronic scrip and settle dematerialised trades. "ensemble selects, develops and implements specific technologies to support the new processes, based on those assessments," he adds.
"ensemble`s clients will benefit from a combination of good business process design skills, financial markets knowledge and experience in implementing technologies used to support trading and settlement processes." Moreover, Shaw testifies to ensemble`s use of workflow-based programmes and specific knowledge in this area as a substantial factor to the successes in current conversion projects.
"Further benefits for brokers implementing STRATE, is process efficiency," he emphasises. "Efficiency in time and costs in the settlement operation, as well as delivering a tighter control environment and minimising operational risk. Additionally, brokers are given an opportunity to restructure the business around more cost efficient processes," he concludes.
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ensemble, established in 1996, is focused on providing business aligned IT Solutions to the Banking and Finance sectors in the Southern African region. During 1998, Wang Global Africa (now Getronics) acquired a 51% majority share-holding in ensemble, in order to enhance the offer of its Solution Integration Division. ensemble`s major technological value lies in its vast knowledge of Relational Databases, Object Orientation, Microsoft technology and the latest Internet and Intranet development tools and packages. With its current structure and alliances, ensemble has access to many IT professionals, best of breed packages and frameworks, countrywide roll-out and deployment, helpdesk infrastructure, as well as a solid financial backbone.
Headquartered in London, HSBC Holdings plc is one of the largest banking and financial services organisations in the world, providing a comprehensive range of financial services: personal, commercial, investment and private banking; trade services; cash management; treasury and capital markets services; insurance; consumer and business finance; pension and investment fund management; trustee services; and securities and custody services. The HSBC Group`s international network comprises more than 5,000 offices in 80 countries and territories, operating in the Asia-Pacific region, Europe, the Americas, the Middle East and Africa. With listings on the London, Hong Kong and New York stock exchanges, shares in HSBC Holdings plc are held by some 180,000 shareholders in more than 90 countries and territories.