Managing voluntary corporate actions (VCAs) has many challenges, as we covered in our "Middle Office Series - Voluntary Corporate Actions" podcast. Processing these corporate actions is operationally risky; if events are missed or elections are submitted late or incorrectly, the consequences can be costly—some institutions have experienced losses in the millions of dollars.
The process is also typically manual and cumbersome. Often, the investment operations team is responsible for capturing all of the event notifications from custodians and prime brokers and communicating them to the portfolio management teams. This process also includes communicating with banks regarding discrepancies, tracking updates, chasing decisions, and communicating election instructions separately to each bank. Most firms still use spreadsheets as their primary tool for keeping track of these actions. Events can change, which further complicates the process. Discrepancies are common, and it is essential to keep the details updated to make sure decisions are based on accurate and reconciled information.
Firms can ensure they never miss an event by engaging a VCA service. The right VCA service provider will streamline the election process by using an advanced system of monitoring and notifications and presenting events in an intuitive user interface that optimizes users’ workflow. It’s important to choose a service that can translate SWIFT (Society for Worldwide Interbank Financial Telecommunications) notifications into a user-friendly presentation to help make decisions based on complete and accurate data. Not all banks use SWIFT, so you need a provider who can work with banks regardless of whether they are SWIFT-enabled.
SS&C’s Voluntary Corporate Actions service is a comprehensive solution that leverages SS&C’s technology and an experienced service team that supports clients on a 24 x 5 basis. Our scalable solution can service clients of every size, from investment firms managing a single portfolio to those with dozens of portfolio managers and thousands of holdings. Rather than gathering VCA data from multiple sources, SS&C’s service allows you to log in to a single portal to access all the data in one location.
