In November 1991, a group of 25 investment managers, custodian bank and portfolio accounting and communication vendors gathered together to discuss the possibilities of developing or adopting a standard automated method for communicating trade instructions between investment managers and custodian banks.
The group became known as the Industry Standardisation for Institutional Trade Communication Committee or ISITC and in January 1992, ISITC Europe was formed.
The need for standards
To capitalise on improved technologies and eliminate the need for manual processing, many custodian banks created proprietary links which allowed an investment manager to deliver trade information on an automated basis. The issue with this approach was that it lacked standardisation and required each manager to build a separate link to each custodian. Managers and banks quickly realised that they needed to adopt a universal format to provide all organisations with the ability to establish efficient links with their counterparties in the industry.
With the development of standards for post settlement/clearance and asset servicing during the early 2000s, ISITC Europe expanded its collaboration with other industry associations to provide end to end coverage. These included S.W.I.F.T., FPL, ISDA (FpML), FISD, Omgeo and TWIST. Today ISITC Europe works closely with these entities to understand any proposed changes as well as reviewing the need for new functional standards.
ISITC Europe has expanded its efforts to focus on common industry issues, such as common securities and counterparty identification, Electronic Trade Confirmation and Matching, Claims and Penalties processing and IT changes.