Bespoke Large Holdings Regulatory Reporting Solution
Reformis were commissioned by a large international Asset Management company to provide a solution to replace their existing Large Holdings Reporting (LHR) processes.
Existing processes relied heavily upon legacy applications and manual intervention, and were additionally unable to cater for the different types of reporting required by the EU Transparency Directive.
The objectives of the solution were to:
- Ensure compliance with both UK and overseas large holding regulations
- Reduce the risk of incorrect, late or missed disclosures
- >Automate the process of loading reference and holdings data required for reporting from Eagle PACE
- Improve the ability to meet new and changing requirements for both UK, EU and other overseas LHR requirements
The Reformis solution employed a dedicated LHR database to store all data required for processing and reporting large holdings.
The LHR database receives its primary feeds of reference and holdings data from Eagle PACE databases via an ETL process. This process ensures the LHR database is refreshed with new and updated data maintained in the Eagle PACE database.
The LHR Rules Engine calculates the current holdings of issuers and compares this with previous holdings, using rules stored and maintained in the LHR database, to determine if a notification is to be produced. The Rules Engine additionally calculates all values required for reporting of the large holding and saves this information with the notification.
The LHR Application is used to process the notifications – facilitating the production of notification letters, faxes and forms, based on templates, for sending to notification recipients. Application workflow components allow monitoring of the status of notifications, storing dates of when sent to compliance for review and when sent to the recipient regulatory body.
The LHR application is also used for maintenance of the LHR rules and amendment of static data required for large holdings processing.
The reports, forms and letters output from the large holdings processing can be printed from the application or emailed to a recipient.
Calculation of Holdings and Notifications
The Reformis LHR solution caters for each of the following elements in determining the calculation of holdings and notifications:
- Calculation type: % of shares held vs. % of voting rights held
- Security types: current ownership and rights to purchase
- Direct vs. Indirect holdings
- Aggregation of holdings by issuer
- Dynamic fund to legal entity relationships
- Initial thresholds for notifications
- Subsequent thresholds for notifications (fixed and holding dependent)
- Reduced holdings and de-notifications