ISO 15022 XML: A model for
Standards Convergence
Sandy Dinetz, Director
Depository Trust & Clearing Corporation
Interoperability Summit
June 27, 2002
Agenda
Standards for Securities
ISO 15022 XML Working Group 10
ISO 15022, second edition (XML)
Convergence and Interoperability
Conclusion
Standards for Securities
The pre-XML era
• ‘70s: Financial Industry creates
•• SWIFT
SWIFT for
for global
global processing/ID
processing/ID for
for US
US Domestic
Domestic processing
processing
• ‘80s: ISO/TC68/SC4 defines ISO 7775
• ‘84 - ‘97: ISO 7775 deployed (on SWIFT)
• ‘90s: several industry initiatives
• e.g. Financial Information eXchange (FIX)
• ‘94-‘99: ISO/TC68/SC4 defines ISO 15022
The XML era
• Multiple XML-related initiatives emerge.
• Some examples:
• FIX defines its XML-version: FixML
• SWIFT defines “SWIFTStandards XML”
• FpML: XML-standards for derivatives
• MDDL: XML-standards for market data
• GSTPA, Omgeo: “ISO 15022-based” XML
The current standards landscape
OTC
Derivatives
Mutual
Funds/
Unit Trusts
F/X
Exchange
Traded
Derivatives
Fixed Income
Equities
15022
PRE-TRADE
TRADE
15022
POST-TRADE
/PRE-SETTLEMENT
15022
SETTLEMENT
15022
POST SETTLEMENT
Post-Trade – Pre-Settlement
FIX
SWIFT
GSTPA
Omgeo
Field
Side
Indicator
Buy/Sell Indicator
Values
1=Buy
BUYI=Buy
Buy/Sell
Indicator
BUYI=Buy
BUYI=Buy
2=Sell
SELL=Sell
SELL=Sell
SELL=Sell
3=Buy Minus
Syntax
Codes
…
54=1
:22a::/BUSE// <BuySellInd> <BuySellIndicator>
BUYI
BUYI
BUYI
or
</BuySellInd>
</BuySellIndicator>
<Side Value=‘1’>
Proprietary plus
ISO Codes
ISO Codes
ISO Codes
Proprietary plus ISO
Codes
The role of XML
• Has XML solved all problems?
• Single technology
• Multiple XML-based standards initiatives
• Not more interoperability than before
• So what has XML done?
• XML has made the issue more apparent
• XML has accelerated the drive towards convergence
ISO 15022 XML Working Group 10
The mission statement*
“Evolve ISO 15022 to permit migration of the
securities industry to a standardized use of
XML, guaranteeing interoperability across the
industry and with other industry sectors,
particularly but not restricted to the financial
industry”
*WG
*WG 10
10 is
is aa working
working group
group created
created in
in 2000
2000 by
by the
the ISO
ISO
Technical
Technical Committee
Committee TC68
TC68 (Banking,
(Banking, securities
securities and
and other
other
related
related services)
services) under
under their
their sub-committee
sub-committee SC4
SC4
(Securities
(Securities and
and related
related financial
financial instruments)
instruments)
Drivers resulting from the mission statement
• Integrate all domains of securities industry
(from pre-trade to post-settlement)
• Take into account existing industry standards
in Securities (e.g. FIX, FpML, MDDL, …)
• Take into account international initiatives on
message standards and XML (e.g. ebXML)
• Take into account technological evolution:
XML is not the end
WG10’s objectives
• Stability
• Business-driven approach
• Interoperability and convergence
• End-to-end based on common semantics
• Flexibility
• Market practices and asset classes
• Predictability and speed
• Foster reuse and automation capabilities
Standards Development
• Leveraging New Technology
• Business Modeling – Unified Modeling
Language (UML)
• XML
• Evolving Existing Standards
• Creating New Standards
• Standards Repository
• Expanding Asset Class Coverage
• Focusing on Market Practice
WG10’s approach
ard
Stand
ent
m
p
o
l
e
Dev
logies
o
d
o
h
Met
WIF T,
S
.
g
.
e
(
, …)
L
M
X
b
e
ISO 15022
Data Field Dictionary
ISO 15022
Catalogue of Messages
ISO
15022:
1999
022
5
1
O
S
I
menm
o
c
e
R
s
dation
WG 10
Other Industry
Messages
ISO 15022
Standards Repository
ISO 15022 second edition (XML)
Main focus
Create a framework to establish an agreement on
how to develop, implement and maintain (securities)
industry standards
Building
Building Blocks:
Blocks:
• Applying Business Modeling to Standards Development
• Harmonizing the Use of syntaxes (XML)
• Implementing a centralized Standards Repository
• Leveraging Industry Coordination
The building blocks
• Business Modeling for standards development
• Syntax-independent business standard
• Neutral way to cover all functionality
• Aligned with international approach
• Harmonizing the use of syntax (e.g. XML)
• Predictable & “automate-able” design rules
• Protect standard from technology evolution
The building blocks
• ISO 15022 Standards Repository
• Business Process Warehouse
• Data Dictionary (foster reuse)
• Maintained by Registration Authority
• Industry Co-ordination:
• “Reverse Engineering”
• Standards Management Groups
The modeling methodology
Standards
Repository
“Understand the business”
“What is the problem”
“Define the solution”
Business Analysis
Requirements Analysis
Logical
BUSINESS MODEL
Analysis
OrderToBuyOrSell
TradeCondition
“Refine the solution”
“Physical implementation”
(automated)
InstructingParty ExecutingParty
Trade
-TradeDate: Date
-SWIFTIdent: BIC
-SWIFTIdent: BIC -Security: ISIN
-Action: {Buy/S
-PriceCondition: Real
-OrderedQty: Real
Message
Design
BUSINESS SCENARIOS
& MESSAGES
Technical
Design
Technical Implementation
SYNTAX,CODES
SOLUTION TO IMPLEMENT
Proposed ISO 15022 Standards Environment
User Community
Registration
Management
Group
Registration
Authority
Standards
Management
Group
Standards Repository
OTC
Derivatives
SMG
SMG
Mutual
Funds/
Unit Trusts
SMG
SMG
F/X
Exch. Traded
Derivatives
SMG
SMG
Fixed Income
SMG
SMG
Equities
Standards
Management
Group
SMG
PRE-TRADE
TRADE
POST-TRADE
/PRE-SETTLEMENT
SETTLEMENT
POST SETTLEMENT
Standards
Management
Group
Web - Site
15022
User Community
User Community
Evolving ISO 15022
ISO 15022
Standards Repository
Data Field
Dictionary
SSAB
s1
s2
ISITC
a1
a2
7775
:10:
:11:
E7775
EDIFACT
:21::
:22::
OTC
Derivatives
SMG
SMG
Mutual
Funds/
Unit Trusts
SMG
SMG
:23::
F/X
:24::
s3
Exch. Traded
Derivatives
SMG
SMG
SMG
Fixed Income
Catalog
of Messages
SMG
Equities
SMG
PRE-TRADE
7775
520
521
522
523
534
E7775
TRADE
POST-TRADE
/PRE-SETTLEMENT
SETTLEMENT
POST SETTLEMENT
EDIFACT
540
541
542
543
548
SMG – Standards Management Group
!
Business Process Warehouse
!
Data Dictionary
The resulting ISO Committee Draft
• The official standard:
• ISO 15022 – Part 1
• High level description of modeling approach
• High level description of Repository
• High level description of inputs and outputs
• ISO 15022 – Part 2
• Definition of registration bodies
• “Service Level Agreements”
Supporting Documents
• ISO 15022 Modeling Guidelines
•• How
How to
to build
build message
message standards
standards
• ISO 15022 XML Design Rules
•• How
How to
to convert
convert messages
messages in
in XML
XML
• ISO 15022 Reverse Engineering
•• How
How to
to capture
capture existing
existing industry
industry standards
standards
•• How
How to
to build
build “convergence
“convergence documentation
documentation
• ISO 15022 Submission Templates
Convergence and Interoperability
The current situation
ISO 15022
?
GSTPA
?
?
Proprietary
?
?
?
TBMA
?
FIX
Omgeo
Industry coordination is happening
The Bond
Market
Association
(TBMA)
Fixed
XML Working
Group
Income
Expertise
WG 10
Pre-Trade/
Trade
Fixed
Working
Income
Group
Post-Trade/
Pre-Settlement Expertise
ISO 15022
Post-Trade/
Pre-Settlement
Expertise
VMUs
Post-Trade/
Pre-Settlement
Expertise
ISITC
Omgeo
Sungard
ISO 15022
Registration
Authority
Market
Practice
GSTPA
Interoperability
FIX Protocol
Limited
Support of WG 10
FIX on the SWIFT
Network
SWIFT
SIA
Reverse Engineering
BMA
Omgeo
GSTPA
FIX
ISO 15022
+
ISO 15022
Repository
Convergence
Documentation
“Standard approach” for Reverse Engineering
Gap Analysis
Existing Standard
Business Model
Execution Report
Tag
Convergence
Documentation
Field Name
Re Comments
q'd
Standard Header
Y
MsgType = 8
37
OrderID
Y
OrderID is required to be unique for each chain of orders.
198
SecondaryOrderID
N
Can be used to provide order id used by exchange or
executing system.
Securiti esT ransa cti on
Securiti esT ransa cti onL egReference
T ra deRol eT ype
T ra deOrd er
ClOrdID
N
Required for executions against electronically submitted
orders which were assigned an ID by the institution. Not
required for orders manually entered by the broker.
41
OrigClOrdID
N
Conditionally required for response to an electronic Cancel
or Cancel/Replace request (ExecType=PendingCancel,
Replaced, or Canceled). ClOrdID of the previous order
(NOT the initial order of the day) when canceling or
replacing an order.
ClientID
N
Used for firm identification in third-party transactions.
76
ExecBroker
N
Used for firm identification in third-party transactions.
382
NoContraBrokers
Balance
Account
11
109
0..n
Recipient
BrokerSideSettl ementParam
eters
1
Status
ClearingAgent
AccountId
Orde rExpi ryDateT i m e
Custodian
Securi ti esAccount Servicer
BuyOrSel lInd icator
CashAccountOwner
Pri ori tyIndi cator
CashAccountServi cer
Execution T im eL im i t
CashAccount
Am ount
DebitCredit
Type
Securi ti esT ransaction
CalculationTim e
Securi ti esT ransactionLe gRefe rence
ValueDate
T radeRol eType
.. n
1..n
1
1
Orde rT ype
S
Ca sh Acco un t
e
c u ri t ie
s B a
la
n c e
Se cu rit iesId
Fi nancial Instru men tBal ance
Ca sh Acco un tId
Cu rre ncy
Cli en tSi deSe ttle m entParam eters
SecuritiesAccount
T rade
SecuritiesAccountId
Requ estedSe ttle m entDate
Previ ousl yExecutedQuantity
+ExecutingCounterParty
1..n
Order
Quanti tyRem aini ngOnOrder
Cle arin gAgen t
AdvisedQuantity T rad eParam ete rs
Deali ngCapacity
Custod ian
Broker/Deal er
CashTIndi
axAccount
BuyOrSell
cator
0..n
Orde
Securiti esAccount
ExecutedTradePri
ce re dQua ntity
(from BusinessActors)
{ordered}
T radeAm ount Orde rPrice 1
Cash Accoun tOwner
Su bS ecuritiesAcc ount
2
BrokerSoli ci tedT rade
Requ estedPl aceOfT rade
Cash Accoun tSe rvi ce r
CumOrExBonus
Cash Accoun t
MarginAccount
CumOrExCoupon
CumOrExDi vidend
T radeT ransaction
CumOrExRi ghts
ExecutedTradeQuanti ty
Cash/DVPAccount
Special CumOrExDi vidend
DealPrice
CashChargesAccount
OrderBook
SoldShortIndicator
T radeDateTi me
DirtyCl eanIndi cator AbroadAccount 1..n NumberOf Day sA ccrued
Pri ceT im ePri ori ty
1
N
Number of ContraBrokers repeating group instances.
"
375
ContraBroker
N
First field in repeating group. Required if NoContraBrokers
> 0.
"
337
ContraTrader
N
Fungibi li tyCode
GuaranteedDel ivery
Broker'sDueBil l
CumOrExWarrant
CashCom missionAccount
WarehouseT rade
AccruedInterestAmount
DealAm ount
CentralisedAccount
Settlem entAm ount
ForexResultingA mount
PostingSe ttlem entAm ount
T ypeO fPri ce
Margi nA m ount
1
ShortSaleAccount
Mark-upPri ce
PhysicalAccount
T radeT ransactionT ype
+ExecutedPl aceOfT rade
Mark-downPrice
Issu eDi sco untAl lo wanc e
Portfolio/FundAccount
AccruedCa
Cl assOfPort folio/Fu
nd pi tal isati onAmount
Co un tryOfPortfolio/FundReg istration
ISO XML
FIX
ExecBroke BrokerDealer
DealPrice
Price
..
..
1
0..1
Market
Comm issions
1
T axes
1
(from Busi nessActors)
T radeCharges
Message Model
NoticeOfExecution
ConsistencyOnBuyer/Seller()
XML Schema
+TradeDetail
1..*
Trade
DealPrice [1] : Price
FilledQuantity [1] : FinancialInstrumentQuantity
+Seller
+Buyer
1
<<abstract>>
+StepInBroker
1
0..1
+FinancialInstrumentAttributes
TypeOfSeller/Buyer
<!ELEMENT NoticeOfExecution
1
StepInBroker
ProcessingReference [0 ..N] : String
FinancialInstrument
(from MessageElements)
(Seller,Buyer,InvolvedStepInBroker?,FinancialInstrumentAttributes,
TradeDetail_)>
Identifier [1] : ISIN
CurrencyOfDenomination [1] : Currency
ClassificationScheme [1] : String
BrokerDealer
Inv estor
Role [0..1] : TradeCapacityIndicator
<!ELEMENT Seller (%_Investor_ ; |%_BrokerDealer_;) >
<!ELEMENT Buyer (%_Investor_ ; |%_BrokerDealer_;) >
Migration
<!ENTITY %_Investor_ “Identification”>
Party
(from MessageElements)
Identif ication [1] : PartyId
<!ENTITY %_BrokerDealer_ “Identification,Role?”)
<!ELEMENT InvolvedStepInBroker (Identification,ProcessingReference_) >
Development &
Registration
Timeline
2001
Pre-trade &
Funds
FIX
2002
2003
FIX
15022 (XML)
Post-trade & 15022 (MT)
Pre-settlement
15022
(XML)
Settlement & 7775 (MT) 15022 (MT)
15022 (XML)
Reconciliation
Corporate
Actions
Lending &
Borrowing
7775 (MT) 15022 (MT)
15022 (XML)
-
15022 (XML)
> 2003
Conclusion
WG10 Next steps
• Approval of the standard (ISO process)
• Initial population of repository:
• Reverse engineering pre-trade
• Reverse engineering post-trade
• Reverse engineering other domains
• Finalize documents, templates, web site
• Liaisons with relevant industry groups (e.g.
MDDL, FpML, …)
WG10 Challenges
• General Issues
• Agreement is difficult and takes time
• Implementation and migration costs
• WG 10 Specific Issues
• Education: new technology & concepts
• Business modeling (UML)
• Timing & Resources:
• Standards Repository population
• Marketing & Liaisons
uestions
[email protected]
&A
nswers