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Post Maturity Date Reconciliations Issue

Post Maturity Date Reconciliations Issue


Status: For Review, Last Updated: 31/08/2023

Validation field(s) in scope – 2.14

The RTS for Trade Repositories mandates that unreconciled SFTR reports should be visible on the daily Trade State Report for 30 days following the maturity or termination of that report.

ISLA members raised concerns that:

•The current validation rules do not allow participants to submit a modification to a report, where the Event Date of the report is greater than the maturity or termination date.

•The result of this, is that participants are unable to fix unreconciled reports during this 30-day period.

•In addition, in scenarios where a settled return becomes unsettled again, participants are unable to 'resurrect' the corresponding report.

This is an acute issue for most of ISLA members, including Agent Lenders, where firms are unable to fulfil the regulatory obligation to match and reconcile reporting with respective counterparties.

Where it relates to Agent lenders, the reporting process is complex due to:

•The unreconciled reports, following maturity or termination, severely impact the Agency lender's reporting  (shell vs allocations) to the borrowers due to the mandatory pre-matching conditions for key pairing fields and, therefore, further impacts the timeliness and accuracy of reporting allocations under SFTR.

•The reconciliation on the matching platform can only occur with the latest event records received from the agent lenders, which cannot be reconciled on the historical event if not reported or incorrectly reported.

Best Practice:
ISLA members propose several approaches as potential solutions to this challenge:

Long-term solution:

The solution to several reconciliation and pairing issues should be addressed through an amendment to SFTR reporting rules which would require changes in Level 1 (primary) legislation.

Such as:

1. Change in the logic for updating the Trade State Report by TRs, that is:
•TRs to update the Trade State Report relying on the logical order derived from the “Event Date” without applying any restriction based on the “reporting timestamp”.


2. Remove the existing limit of 30-day period and reconcile only Live SFT trades.


3. Further widening the limit of 30 days period. (SFTR-210)


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