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ETF EXECUTION SERVICE OFFERING
National Bank Correspondent Network
Christine Rodrigues, Senior Vice President, Business Development and
Relationship Management
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AGENDA
• INTRODUCTION AND OVERVIEW
OF SERVICE OFFERING
• PROCESS WALKTHROUGH
• NEXT STEPS AND OPERATIONAL
CONSIDERATIONS
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INTRODUCTION AND OVERVIEW
OF SERVICE OFFERING
• National Bank Correspondent Network (“NBCN”) is
the premier provider of custody, trade execution
and brokerage solutions to independent Portfolio
Managers and Investment Dealers.
• Today, we service over 400 firms representing
more than $100B in assets under administration.
• We were approached by the Canadian ETF
Association (CETFA) to help find a solution to
provide custody, trade executions and clearing
services for Mutual Fund Dealers specific to
certain ETF products.
• Our solution is to offer these services through
one omnibus account per Mutual Fund Dealer.
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DIVISION OF RESPONSIBILITIES
Mutual Fund Dealer
NBCN
Relationshi
with Client
• Responsible for all
and regulatory responsibilities
• Relationship is solely with
Accounts
• Book of record for individual
• One omnibus account per
Trading
• Send trade instructions to NBCN
account
• Responsible for all regulatory
• Execute trade on market and
confirmation and trade files
Entitlement
Corporate
Actions
• Provide instructions to NBCN for
account
• Report on Dealer Book of Record
• Allocate to individual accounts
• Execute corporate actions in
instructions in omnibus
• Execute entitlements in
account
• Provide details to Dealer on
basis
Transfers
• Provide instructions to NBCN
• Confirm all client details
• Follow-up on incoming or outgoing
• Set up transfers on CDS based
Dealer’s instructions
• Provide confirmation of CDS
Reconciliat
• Responsible for all
• Provide files to support
reconciliation process
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PROCESS WALKTHROUGH
Mutual Fund
Dealer
NBCN
MARKET
TRADING
SYSTEM
EXCHANGE
FILL
ORDER
LONG POSITION IN
FIX CONNECTION
CONFIRMATIONOMNIBUS ACCOUNT
OMNIBUS
ACCOUNT
T+1 FILE OF ALL
PROCESSED TRADES
TRADE EXECUTION/RECONCILIATION
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PROCESS WALKTHROUGH
Mutual Fund
Dealer
NBCN
TRADING
SYSTEM
MARKET
EXCHANGE
OMNIBUS
ACCOUNT
TRUST
ACCOUNT
CDS CLEARING
NET CASH EXCHANGE
SETTLEMENT BOOKING
SETTLEMENT
TRADE FILE
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NEXT STEPS AND
OPERATIONAL CONSIDERATIONS
Operational Considerations
• Electronic connection to NBCN for trade execution
via FIX protocol (Financial Information eXchange)
•
Entitlements: NBCN will provide factors on a bulk
basis. The Dealer must have the ability to track and
post at the individual client level in order to
perform the proper allocation on the Dealer’s Book
of Record.
•
The Dealer must be able to maintain a reconciliation
process using NBCN’s daily transaction files.
Next Steps
•
Determine that the process can be supported.
•
Contact a NBCN Regional Vice President to learn more
about the offering.