Beyond regulatory use cases, slowly and steadily LEI data is becoming part of the list of essential data identifiers for harmonizing data sets and regulatory reporting. The Legal Entity Identifier (LEI) is an alphanumeric code of 20-digits that enables clear and unique identification of legal entities participating in financial transactions. LEI are required by firms to fulfil their reporting obligations under financial regulations and directives. It connects to key reference information that would support in maintaining quality, transparency and efficiency of financial data systems for better risk management. With the adoption of LEI globally, it enhanced the ability of financial regulators to monitor and analyze threats to financial stability of companies. Whenever any firm transacts in the global market, the LEI will allow regulators to keep an eye and can accurately assess the aggregate risk of financial institutions. This may help in preventing financial industry disasters like Lehman.
Challenges in obtaining LEI data:
The LEI data is publically available on various sources still an institution face certain challenges while capturing LEI information:
Humongous data: There is immense data available to record, monitor and capture key reference information.
No LEI no trade: Market participants will not be able to trade with in-scope firms if they do not have LEI and are eligible for obtaining LEI.
Dynamic data: Information available on public sources will keeps on changing with the passage of time.
A lack of standardized documentation across various countries makes the task of fulfilling compliance obligations and confirming ownership is difficult.
Stale data: The information derived can become stale or derived from a non-reliable source where the quality of data is not up to mark can lead to issue with data management.
What is Xoriant CDi working methodology and how it can address challenges with respect to LEI data?
Xoriant CDi is tracking LEI information actively from 2012 to develop a pillar of understanding and keep itself updated with the changes and modifications. Despite of enormous changes in publically available data we are able to maintain most accurate database of LEI information. In order to overcome with the challenge faced, Xoriant CDi is continuously working over the solutions as follows:
Maintain accurate and updated database of more than 14 million customers with periodic review.
In house language experts ensure customer data verification in their native language.
Maintain regular updates of corporate events like – name change, merger, acquisition, liquidation, bankruptcy, etc.
Tracks corporate action associated with the entity and implements same to maintain accuracy in customer relationship and ownership.
CDi OnDemand offers a clear view of Level 2 and above hierarchy i.e. beneficial ownership; ultimate or complete structure. Also showcases scenarios with broken tree & circular relationships.
CDi OnDemand has a unique feature that allows effective cross-referencing of beneficial ownership information by certain identifiers.
Self-service model for gold copy database creation and management.
Unlimited queries of Xoriant CDi entity database.
Customized operational workflows.
Rapid data aggregation.
Elastic manpower – 24×5 access to CDi data stewards.
Proactively managing data quality errors, such as duplicity in counterparty hierarchy, invalid values, etc.