Financial Models Company (FMC), a Canada-based software vendor for the investment industry, has opened an office in Australia to serve as a support hub and service provider for the Asia-Pacific region. FMC Software, the Australian operation, will also try to gain market share for FMC products in Australia and New Zealand.
FMC has many customers across Europe and North America, but its Asian customers have often had difficulty with service and support because of time zone differences. An example is Invesco, one of the largest independent global investment management firms, which has offices in Australia, Taiwan, Hong Kong, Singapore and Tokyo. "With the new Sydney office we can offer better support in the same time zone," says Yolanda Willett, managing director of FMC Software.
Willett says that while the Australian office will eventually serve as an entry point to the Asian market, at this stage FMC is not directly targeting Asia-based financial institutions. "We've had some expressions of interest and will follow them up, but we're not going out selling to them directly at this stage. We're just going to concentrate on the Australian market first," she says
FMC moved into the Australian market last year with a joint venture called Independent Software Services (ISS). The JV was set up with Permanent Trustee Company, a major provider of back-office outsourcing services to fund managers that has over $100 billion under its own administration.
Willett says the joint venture has been a good introduction to the Australian market for FMC. "Through our relationship with ISS, we have already met with several investment managers who provided us with positive feedback about our product suite and delivery options," she says.
FMC Software, the Australian office, will provide the full range of FMC products, but all enquiries for FMCNet will still be referred to ISS and the two parties will continue their joint marketing.
FMC's suite of products cover front, mid-tier and back-office applications, all of which are aimed at promoting straight-through processing (STP) in the investment management community. STP is the Holy Grail of financial technology. At a basic level it is the processing of securities orders, trades, confirmations, matching and settlement seamlessly and without human intervention.
But true STP is fraught with many problems, including disparate technology, differing regulations between countries and inefficient practices at financial institutions. Part of overcoming these problems is coming up with software that can communicate with the many networks and communication protocols being used in the global finance industry. In the past few years many former proprietary networks, such as SWIFT, have opened themselves up to third-party connections, and vendors are increasingly offering software that reflect this.
FMC's Willett says the company will be releasing a Financial Information Exchange (FIX) engine this year that will facilitate pre-trade messaging in this format on its FMCNet solution. FIX is a messaging protocol that's commonly used by stock exchanges and broking houses. "This will complement our SWIFT bureau and mean that everything's hooked up through the one system," she says.
FMC has also been a major force in Microsoft's move into serious financial architecture. The company was the first to release a product using Microsoft's Distributed Network Architecture for Financial Services (DNAfs), and Willett says her company is in the process of migrating the full range of its products to DNAfs' replacement û EStraight Through Processing Markup Language (STPML).
STPML is a combination of DNAfs and the eXtensible Markup Language (XML) that is increasingly becoming the standard for e-commerce. STPML was developed by representatives from Microsoft, FMC, Merrill Lynch, Infinity, Bridge, Reuters, CSS, FIX, ILX and NASD. And just when you thought that was the last of the acronyms, STPML was conceived as a superset of FIX, SWIFT, ISITC and DTC ID. FMC claims that STPML can support virtually every industry standard data exchange format.