The new venture will develop a range of software data management services which will enable financial institutions to increase operational efficiency and enhance the straight through processing (STP) of financial transactions.

Reuters and Capco are each investing £16 million of cash in the joint venture. Capco is licensing its e-STP software platform to the new venture and providing consulting and software development services. Reuters will sell the range of services developed by the new company and provide global customer support. Reuters and Capco will each appoint three directors to the new venture’s board.

Competitive pressures in securities trading, increased visibility on performance and shorter trade settlement cycles focused on T+1 are driving financial institutions to apply STP and improve their operational efficiency across all markets. The Securities Industry Association (SIA) recently cited inconsistent and inaccurate reference data as a major issue for the industry in achieving T+1.

The new company will focus on developing products and services that will complement the existing range of Reuters Data Management Solutions, addressing areas such as data cleansing and failed trades. The services, which will be web-based, will enable customers to achieve a significant increase in the accuracy and quality of their data.

This development is the first major venture of the Reuters and Capco alliance initiated in February 2001, when both companies committed to develop back-office software solutions for the financial services industry.

Devin Wenig, President, Reuters Investment Banking and Brokerage Services, said:

Effective management of data is key to all our customers achieving STP and the requirement for T+1. Providing fast accurate data and ways to manage it is one of Reuters core competencies. Our new venture with Capco will enable us to provide the most sophisticated and well-supported range of data management solutions for financial institutions worldwide.

Rob Heyvaert, Chairman and Chief Executive Officer of Capco, added: We believe this new venture will enable financial institutions to achieve greater efficiency as they move to STP. As a proven thought leader in STP and T+1 strategy, we are delighted to be able to work with Reuters to lead this initiative for the industry.

SOURCE: COMPANY PRESS RELEASE