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DTCC 2022 Outlook Commentary – Markets Media

Mike Bodson, President and Chief Executive Officer

In 2022, we expect more asset classes to move into digitized forms, which will open up opportunities for companies like DTCC to support market transformation by creating the infrastructure to process them safely and efficiently. Market infrastructures are best placed to mitigate the operational and counterparty risks associated with digital assets by adopting governance models and standardized post-trade processes that are designed to develop deep, liquid and efficient markets and promote greater confidence from investors and regulators are vital.

Murray Pozmanter, Head of Clearing Agency Services and Global Business Operations

The digitization of securities settlement has intensified in recent years and we expect this trend to continue in 2022 as innovations through new technologies and platforms create the conditions for the development of the clearing and settlement ecosystem. We are pleased, for example, to achieve new efficiency gains in billing with Project Ion, our alternative billing platform that uses distributed ledger technology. At the same time, we will continue to improve existing products and services to add more value to our customers, including our efforts to include additional counterparties in the central clearing for US Treasuries.

· Andrew Gray, Managing Director, Group Chief Risk Officer

While organizations have prioritized risk reduction and resilience throughout the pandemic, companies need to further increase that focus in 2022 as, as history has repeatedly shown us, Black Swan events are more common than in the past. While the risk landsc -e will remain very uncertain for the next year due to the emergence of new variants of COVID and its impact on economic growth, as well as ongoing inflation, supply chain shortages and energy price hikes, risk management professionals need to remain vigilant and identify opportunities for further improvement in risk mitigation and build-up efforts greater resilience to protect their businesses and the entire financial system from market shocks and disruptions. Also, as the frequency of cyber, ransomware and phishing attacks continues to increase, the industry must focus on further strengthening public-private partnerships, participating in war-gaming exercises, and investing in tools and technology as part of their security . Recovery and operational resilience strategies.

· Matt Stauffer, Managing Director, Head of Institutional Trade Processing

We assume that the ongoing pressure from regulatory and industry-specific requirements will continue to drive the need for a higher degree of post-trade automation in 2022 as well in Uncleared Margin Rules (UMR). For SDR, companies strive for greater efficiency and integration throughout the post-trade lifecycle to avoid penalties and fees associated with failed trades and late settlement. For UMR, companies will benefit from further automation of the collateral management process, which will help the affected organizations comply with the phase 6 mandate, while at the same time being able to use their available collateral more effectively, which should improve c -ital and liquidity management.

· Chris Childs, Managing Director, Head of Repository & Derivatives Services

In the next few years, DTCC and the industry will focus on significant regulatory changes as almost all regulators change their reporting requirements for derivatives trading in part to respond to the CPMI and IOSCO recommendations for greater data harmonization in order to promote more transparency on systemic ones Level. We expect the CFTC to implement its changes first in the course of 2022, with other jurisdictions to follow in 2023 and 2024. Over the next year we will also see the introduction of Unique Product Identifiers (UPI) in preparation for these regulatory changes, as well as the definition of ISO 20022 schemes.

· Tim Lind, Managing Director of DTCC Data Services

In 2022, we expect continued demand for market transparency and DTCC will offer more data products to meet this increased need. We will particularly focus on repos, fixed income, ETFs and other markets where there is fragmentation of trading and for those markets we will provide comprehensive information to companies to support both risk assessments and valuations when investing and investing Trading decisions are made

· Laura Klimpel, General Manager of Fixed Income Clearing Corporation

In 2022, FICC will continue to lead the discussion on how to develop the optimal market structure for US Treasuries. The unprecedented volatility in US Treasuries during the pandemic has shown the importance of making financial services operations more efficient, transparent and resilient. We have come to a point where we have broad industry consensus on the benefits of increasing centralized clearing of US Treasury transactions, which would ultimately reduce risk and improve stability across the industry, and we look forward to it looking to work with key stakeholders to make this h -pen.

· Michele Hillery, General Manager of Equity Clearing and DTC Settlement Service

With companies expected to remain under pressure to reduce costs and risks in 2022 due to ongoing economic and market uncertainty, DTCC will continue efforts to postpone the U.S. securities settlement cycle to T + 1. This will add c -ital efficiency to companies while reducing the systemic and operational impact on the industry, especially in times of market turmoil. We are working closely with SIFMA, ICI, regulators and market participants on this important initiative to strengthen the market structure.

· Jennifer Peve, Managing Director, Head of Strategy and Business Development

The digitization of the financial markets will continue to increase in 2022. DTCC will continue to focus on finding new ways to drive financial markets forward through innovations in market infrastructure, including our new Digital Securities Management platform, which will bring automation, standardization, tokenization and efficiency to private markets using new technologies. As the industry advances on its digitization journey, it is critical that implementing changes in post-trade infrastructure be inclusive and accessible to enable responsible innovation for all while enabling connectivity options, ease of use, and value creation.

· Susan Cosgrove, Managing Director and Chief Financial Officer

Next year CFOs will be put to the test as we deal with uncertain market conditions and a host of economic challenges, including sustained inflationary pressures, supply chain issues and possible new corporate taxes. We have not seen a coincidence of events like this in many years, and organizations will turn to their CFOs for advice on a much wider range of topics. For CFOs, we need to be even more agile and leverage multiple levers to ensure our businesses remain profitable while continuing to invest in strategic priorities.

· Keisha Bell, Managing Director and Head of Diverse Talent Management

Moving into 2022, it will be critical for companies to continue to focus on diversity and inclusion while maintaining a collaborative work environment. Inclusion plays a key role in attracting and retaining talent and therefore has a direct impact on whether a company can achieve its corporate goals. Likewise, a robust environmental, social and governance (ESG) framework  -peals to the potential workforce as it corresponds to their values.  -plicants increasingly want their employer not only to act responsibly, but also to do the right thing. In order to attract and retain the best talent and achieve the best business results, DEI and ESG must remain at the fore within organizations.

· Lynn Bishop, Managing Director and Chief Information Officer (CIO)

Technology innovation will no doubt be a key theme in the next year as companies continue to modernize legacy technologies and build new skills to efficiently meet ever-changing customer and industry needs, including robust multi-platform strategies that reduce risk and improve time to market . At the same time, resilience will continue to be a major focus, with organizations placing increasing emphasis on operational resilience and their ability to keep business operations going. In particular, there is a strong focus on the resilience of  -plications, with resilient c -abilities being built in at the  -plication level through reusable standard architecture patterns. All of this ultimately underpins ensuring that companies are able to attract and retain top talent while building diverse and inclusive teams and identifying opportunities for employees to retrain and expand their skills to ad -t to business needs such as Cutting-edge technologies such as artificial intelligence, DLT and robotics.

· Marie Chinnici-Everitt, Managing Director and Chief Marketing Officer

In the past few years we’ve seen a paradigm shift as more and more marketing teams use digital methods to reach their customers and key stakeholders. A recent Forrester report forecast that digital marketing spend will reach $ 146 billion by 2023, with an average annual growth rate of 9%. In 2022, we expect further growth in digital marketing, with companies increasingly using digital technologies and platforms to promote their services. We also expect greater alignment between sales and marketing functions as companies consider the entire customer lifecycle and the importance of working closely between these teams to most effectively reach existing and new customers and increase business results.


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