A prerequisite for a profitable, controlled and successful financial services business is a strong, stable and efficient operations function (‘back office’). Despite huge investments in computerisation over the last few decades in an attempt to achieve the highest level of automation or straight through processing (STP), experienced operations personnel are still required to deal with transactions which, for whatever reason, fall out of the automated process and require human intervention.
Over recent years, and certainly leading up to the financial crisis of 2008, the operations function in many financial services firms was degraded at a time when there was significant growth in activity both in terms of business volume and complexity. This was partly a result of the mistaken belief that the investment in computer systems would make the operations function more or less redundant.
This course is intended to explain the relevance, importance and responsibility of the operations function in today’s financial services industry whether in banks, broker/dealers, funds management, global custody etc. It will provide a comprehensive and generic understanding of the operational aspects of the financial markets and give participants the tools to identify the optimum approach to operations management and to achieving operational excellence. It covers the capital markets products and how and where they are traded and explains the different trading and investment strategies and how they are supported operationally. The course explains the market participants, how they interact and how they are structured.
The concept of straight through processing (STP) is analysed through the life cycle of various transaction types and the course explains what can go wrong and the operations controls required to ensure efficient transaction processing and the avoidance of operational risk.
Attend this intensive and highly practical 4-day course and learn:
- The role and importance of operations in the typical front, middle and back office structure
- The roles and responsibilities in the back office
- Internal and external relationship management and communication
- The ‘Chinese Wall’ and segregation of duties and reporting lines
- Operations as part of wider corporate governance
- Operations, regulators and the impact of regulations
- Operational resources and how they should be managed
- Staff management and motivation
- The concept of STP and why it can break down
- Maintaining static data
- What are ‘fails’ and fails management
- Counterparty fails
- How various trading/investment strategies can impact operations
- An overview of the capital markets and products
- The life cycle of transactions and how market participants interact
- Operating in a multiple market, multiple product environment
- Managing limits
- Cash and collateral management
- Operating in emerging markets
- The back office as a revenue generator
- Pre-emptive strategies to reduce risk, errors and costs
- The end to end control process and the vital importance of reconciliation
- How operational risk can be identified and measured with key risk indicators (KRIs)
- Measuring performance (KPIs)
- Operations and the avoidance of money laundering
- Cause and effect analysis
- Issue escalation
- Management information systems and their use
- The development and relevance of the ‘procedures manual’
- Identifying and allocating operations and transactions cost
- The ‘top’ versus ‘bottom’ line P&L
- Operations and new business development
- Operations role in project management and new systems implementation and managing ‘business as usual’ (BAU)
- The benefits and disadvantages of outsourcing and offshoring
- The request for proposal process (RFP) for ancillary services
- Operations and business continuity planning (BCP)
- Audit (internal and external)
This course is designed not only for those embarking on or developing their careers in financial markets operations, but also for anyone who has an interest in the relevance of the operational function. It will benefit those who need to understand how the capital markets operate, what the operational risks are and how they can be controlled. You will be given a thorough and clear understanding of how transactions are processed, what can go wrong and the measures required to ensure the highest level of STP.
Participants will be provided with the tools necessary to achieve operational excellence.
The teaching methodology used on this course combines formal theoretical instruction with frequent use of exercises and case studies. These are based on real situations experienced by the course director in his forty years involvement in this business. The course is intended to be interactive, with delegates encouraged to ask questions throughout. The course content is intended to give delegates an understanding that will be of immediate practical use in the workplace. The lecturer will be available throughout the duration of the course to offer additional help if required. Delegates will be divided into small teams to work together on the exercises that will include some simple calculations for which a calculator will be required. Each day there will be group discussions on issues identified by the participants.