NORTHERN TRUST, MARKIT LINK ON OTC DERIVATIVES PROCESSING

Posted May 26, 2009

CHICAGO – Northern Trust has reached an agreement with financial information services company Markit to enhance post-trade processing, including reconciliation and confirmation services for OTC derivatives in its global platform for over-the-counter (OTC) derivatives.

The agreement will deliver best-in-breed service capabilities for OTC derivatives to Northern Trust custody and Investment Operations Outsourcing clients through an integrated derivatives processing platform. The enhanced capabilities extend Northern Trust’s core platform for daily processing and lifecycle management, Misys Summit FT, an OTC derivative processing application offered by Misys.

“We are committed to helping our clients reduce operational risk throughout the post-trade lifecycle,” says Peter Cherecwich, Chief Operating Officer for Corporate & Institutional Services at Northern Trust. “The addition of Markit’s confirmation matching and reconciliation services will allow us to provide them with greater transparency and efficiency after the point of trade.”

Markit will provide trade confirmation and position reconciliation services through its Trade Manager, PortRec, and Valuations Manager platforms in addition to independent portfolio valuations. Northern Trust expects to roll out these services in the second and third quarter this year. Markit Trade Manager offers electronic tie-out, affirmation and confirmation workflow tools including straight-through-processing connectivity to DTCC DerivSERV and Markit Wire, along with paper confirmation workflow, novation consent and allocation. Markit PortRec is an automated position reconciliation service that will allow Northern Trust to reconcile positions with counterparties electronically. Markit Valuations Manager provides normalized and consolidated delivery of global counterparty OTC positions and valuations from participating banks.

“We are excited about expanding our relationship with Northern Trust, one of the industry’s most innovative firms,” says Shane Akeroyd, Executive Vice President at Markit. “We look forward to working with Northern Trust to help them and their clients benefit from our extensive connectivity to market participants across electronic position reconciliation, valuations and trade processing services.”

This service offering is part of a multi-year strategic investment Northern Trust is making in its derivative product servicing and reporting capability.