Global Derivatives Awards 2023: Regulatory Solutions Provider of the Year — Europe & Asia — Novatus Global
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Global Derivatives Awards 2023: Regulatory Solutions Provider of the Year — Europe & Asia — Novatus Global

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In a market often dominated by large teams of generic consultants, Novatus Global (Novatus) has used cutting edge software and deep specialisation to create a unique proposition. The firm’s platforms allow clients to run complex regulatory checks and identify problems in seconds. For its leading role at the forefront of RegTech development in the derivatives market, Novatus wins Regulatory Solutions Provider of the Year in Europe & Asia.

Founded nearly five years ago, the firm has a team of almost 40 professionals based in London and serving clients in Europe, the UK, the US and Australia. The range of regulatory regimes that the Novatus platform supports is truly global, extending into key Asian markets like Singapore. But what sets the firm apart is its software-based approach.

“We differentiate ourselves as a software solution platform and we build market share by serving all global regimes,” says Matthew Ranson, regulatory advisory practice and RegTech partner. “In an increasingly complicated global reporting landscape, clients need a technology solution that is regime-agnostic and scalable, which in turn lowers costs and reduces complexity.”

Employing innovative technology to help firms deal with regulatory evolution is one aspect of the firm’s success. The other is a dedicated focus on client communication in order to understand and target customers’ most pressing issues. This client-centric approach was key in creating Novatus’ flagship Transaction Reporting Analysis (TRA) platform. The firm designed the TRA solution in close collaboration with one of the world’s largest banks, carefully identifying what was missing from current offerings.

When Novatus first emerged, its competitors were offering regulatory support services that typically took at least a month to generate results. The Novatus platform allows clients to run reporting tests weekly, daily or even minute-by-minute. The TRA is the only solution in the market that allows clients to seamlessly automate the entire reconciliation process. This incudes pre-submission and post submission, full reconciliation to source systems and generating back reporting files directly,

As its user base grows Novatus remains highly receptive to client feedback. “We don’t rest on our laurels,” says Ranson. “There’s a continuous feedback loop of adding new features and making adjustments. It’s the client feedback that gives us confidence we have the best transaction reporting assurance technology in the market.” In its latest iteration, Novatus has included workflow management integration with the TRA.

Not only do tools like the TRA allow clients to identify errors with unparalleled speed, they provide a level of detail that is invaluable for users. Novatus’ proprietary test gallery identifies errors for clients right down to the exact page of a specific piece of regulation with the relevant web link. Rather than spend time working out what has gone wrong, clients can move straight to fixing the problem.

“Within seconds users can understand the exact error,” says Ranson. “It isn’t just the significant reduction in the risk of non-compliance. We've seen clients saving 50% to 70% in terms of the full-time equivalent staff required to manage the quality assurance of all transaction reporting — a key function required by the regulation.”

A modular approach means that large clients subject to various regimes in multiple jurisdictions can tailor the platform to their exact requirements. MiFID II can be layered onto SFTR on top of CFTC and so on. Novatus maintains its coverage of global reporting regimes through a dedicated regulatory scanning team and an in-house AI tool for filtering regulation. The firm is also in contact with regulators across the globe as part of its professional services arm, which feeds back into its test gallery.

“In a dynamic environment where regulatory expectations change, these three pillars make sure that the test gallery is the most comprehensive it can be at any point in time,” says Ranson.

In addition to helping clients avoid hours of problem-solving, the firm has worked tirelessly to streamline the user experience. Novatus handles all aspects of implementation through a dedicated onboarding team. Clients can supply their data as it comes from systems , meaning no data manipulation is required by the client. This means that users are able to go live on the Novatus platform in a matter of hours.

This ethos has created a distinctive Novatus culture that the firm is careful to cultivate. “We hire special people from a diverse range of backgrounds and that’s crucial in balancing and structuring the team,” says Ranson. The firm has data scientists, back-end developers, front-end developers and professional service advisors. This powerful mix of talent also means Novatus can develop everything in house, leaving it well placed to help clients manage the regulatory challenges of the future.

“We've seen lots of messaging from regulators globally that transaction reporting is essential to preventing market abuse and lowering systemic risk,” he says. “Reporting will only get more onerous as time goes on, but we're there to help clients deal with this complexity in scalable fashion. We cover all global regimes which allows clients to scale as their needs change”

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