ICBCFS | Services Strategy
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Services Strategy

The number of clearing firms servicing institutionally oriented Introducing Brokers has dwindled to a handful. Those firms remaining in the clearing business tend to pursue a business model that is scale-driven. Their service strategy—how they treat clients—is driven by the economics of their business model. This model tends to favor high volumes and replaces qualified people with one-size fits all automation.

ICBCFS differentiates itself on many fronts

  • We do not use Call Centers. Instead, each client has direct access to an experienced team of experts to support their business.
  • Our technology is modern and innovative. It’s been developed during the last decade and is scalable from supporting the smallest to the largest of clients.
  • Our technology is also “open” architected, and offers a fully integrated and robust set of features.This allows for a compressed over-night cycle, resulting in a more efficient user experience. It also makes it easier to support customized reporting.
  • ICBCFS can be a single point of entry to global clearing and settlements. We manage our clients complexities and nuances, rendering the process more efficient while reducing their risk. In addition to our memberships in the major U.S. clearing corporations, we also have access to local market settlements capabilities worldwide via SWIFT, including European Central Counterparties and Multilateral Trading Facilities.

Fully Disclosed Clearing Services

  • ICBCFS supports clients in a highly controlled and efficient Straight-Through-Processing environment for matching, clearing, settlement and custody.
  • Access to margin financing and securities lending capabilities.
  • These services are available on a global basis  for clients  whose businesses require either full service—clearance and custody or are “RVP/DVP” in nature.

Agent or Principal in Fixed Income Transactions

Depending on client needs, ICBCFS can act in the role of “agent” or “principal”, to provide one-stop solutions for post-trade operations.

As agent ICBCFS:

  • Processes the transactions so that the client assumes all associated liabilities and risk
  • The client receives all the core operational benefits that ICBCFS can deliver through a clearing relationship
    • All matched trades settle per instructions
    • Delivery/Receipt vs. Payment
    • Fails are reported same day
    • Intra-day on-line access to settlement details (pending/settled) by depository and/or counterparty
    • New position and performance statements generated both intra-day and daily
    • Custody and corporate actions
    • Finance client positions

As principal ICBCFS:

ICBCFS provides its brokerage clients with the ability to contract out significant portions of their back-office to us. This includes all services as described above as agent including:

  • Access to global counterparties through ICBCFS
  • We can assume the settlement risks associated with our clients’ trades
  • Exclusive financing of client positions
  • ICBCFS provides Model B clearing for European clientele

Omnibus Clearing Services

For clients who want the control of self-clearing, without having to directly maintain, manage and upgrade their back-office, ICBCFS will provide clearing services on an omnibus basis. While the post-trade processing flow is similar to that of fully-disclosed clearing, this option allows the  client to take either very broad or, a narrow control over the various functions associated with clearance, settlement, custody and all associated ones.

Key features of omnibus clearing are:

  • ICBCFS opens one account for the company, the “omnibus account”
  • ICBCFS holds and segregates all cash and securities held in the omnibus account, to ensure that it won’t be tampered with in times of stress.
  • ICBCFS receives and delivers securities on behalf of the omnibus clearing client based on instructions received from the client
  • All sub-accounting, recordkeeping and cashiering are performed by the omnibus clearing client for the customers/beneficial owners
  • Access to ICBCFS for margin financing and securities lending capabilities

ICBCFS’s Omnibus Clearing Services enables clients to concentrate on growing their business while minimizing direct operations, technology and headcount-related fixed costs. This solution allows clients to:

  • Convert fixed to variable costs, by accessing the ICBCFS platform, which is both flexible and scalable
  • Benefit from ICBCFS’s on-going maintenance and upgrade of its platform
  • Concentrate their resources on strengthening and growing existing businesses, while exploring new ones that can be supported by the same ICBCFS outsourcing model
  • Build and promote their brand

Regardless of the clearing solution selected by an ICBCFS client, we can always be counted upon for input and assistance on matters related to business development, compliance, business consulting, tax, execution and enterprise technology, etc.

Facilities Management Services

ICBCFS enables clients to operate more effectively by outsourcing virtually all aspects of their operations and related functions through a Facilities Management relationship. This  includes our clients’:

  • Front End Systems
  • Global Clearance & Settlement through your direct clearance account
  • Collateral Management System
  • Accounting & Operational Reporting
  • Finance ClientP
  • Risk Management

We allow clients to focus on achieving top-line objectives while avoiding operations, technology and headcount-related fixed costs. This solution allows clients to:

  • Convert fixed to variable costs, by accessing the ICBCFS platform, which is both flexible and scalable
  • Benefit from ICBCFS’s constant maintenance and reinvestment in its platform
  • Focus their resources on growing existing businesses, while exploring new ones that can be supported by the same ICBCFS outsourcing model
  • Build and promote their own brand; ICBCFS’s role can be “white labeled”

Clients can consult with our professionals for input and guidance on matters related to business development, business consulting, execution and enterprise technology, etc.

Prime Brokerage Services

Small hedge funds have been forming at a pace not seen in years. This trend presents a significant opportunity for certain Introducing Brokers, working with ICBCFS . It can enable these firms to expand and deepen their relationships with hedge funds beyond execution and into asset aggregation and servicing.  This arrangement will create the basis for “stickier” and more permanent relationships.

ICBCFS provides Introducing Brokers the following benefits, including:

  • The ability to work with a strong global partner, which can provide greater comfort to counterparties
  • Access to cost-effective processing and “white label” technology
  • Customized servicing options
  • Access to our “know-how” and “tool-kit” to operate a successful middle office. These capabilities  include various resources that can be extended to the Introducing Broker’s hedge fund clients.

Execution Services

  • We offer our customers access to a suite of sophisticated execution algorithms and the opportunity to interact with an experienced high touch institutional agency trading desk for US equities.  We do not make markets, trade proprietary or route orders to affiliated broker-dealers. Our goals are aligned with our customers, to seek best execution.
  • The execution algorithms provide our customers with various benchmark strategies, liquidity strategies and access to all major exchanges as well as dark pools. The routing access available to our customers offers opportunities to seek price improvement and improve performance against various execution benchmarks. For more information please visit Execution Services.