Case Scenario: State Street Bank – Investment Bank (Custodian Bank) and the Use of IT services History: State Street Corporation, known as State Street, Is a us-based International financial services holding company. State Street was founded In 1792 and is the second oldest financial institution in the united States. The compass headquarters are at One Lincoln Street in Boston and it has offices in 25 countries State Street is organized into three main divisions.
The Global Services business is a custodian bank with $28 rolling (SAID) of assets under custody and administration. The Global Advisors business provides investment management services and has $2. 3 trillion (USED) of assets under management. The Global Markets business offers investment research and trading services to institutional investors. State Street Global Advisors Global Advisors is State Street’s asset management business and dates back to 1978. It provides Investment management, research, and advisory services to corporations, mutual funds, Insurance companies, and other Institutional Investors.
Global Advisors develops both passive and active management strategies using both quantitative and fundamental approaches. It created the first exchange-traded fund in 1993, the SPUR S 500, and is now one of the world’s largest IETF providers. Global Advisors has staff in 27 global offices and claims to have over $2. 3 trillion (USED) of funds under management. These days every transaction that occurs is digital and monitored by the stock exchanges for malpractice. This was a major problem to many an institutions because suddenly they had to upgrade from their legacy systems to he modern platform.
IT Services provided the perfect solution as not only would it upgrade their systems but also at the same time maintain the enormous data inflows from various zones and provide solutions to Improve the process and make It more automated this saved was boon to the banking Industry as they were able to show large profit margins and a leaner structure to enable future growth. Why IT was and Is successful In the banking sector? The IT industry is structured in verticals and horizontal segments where the verticals ascribe the the type of industry sector e. G (BINS, Auto, Health Care, Retail).
The Horizontals are the resources types required across the entire sector like developers, Testers, Support etc. BINS is a major contributor to the IT sales in terms of revenue. The Banking sector is constantly changing and has to keep pace with the cutting edge technology. IT solutions provide automation scenarios where chance of error is very less, precise, punctual and it is because of this quality that the banking sector is dependent on IT solutions. Information Technology at State Street: Any Banking office has three sector the front office, middle office, back office.
State Street Is primary an Investment bank where It clients or Investment managers will be using the applications to analyze and place trade orders on the State Street systems. Execute these trades and sent the information back to update the system. Simultaneously in the back end there are data warehouses that collect all the data from WET (World Trade Center’s) , Bloomberg & Thomson Reuters about the market feeds etc. The entire functioning of the bank happens at the front office is the direct web or application interface that the client or investment managers will be using to place their trades based on the market information.
The system implied is completely automated with each application feeding the output as input to the next application. Front Office: The end users will be using applications either from the phones or desktops the various IT applications to carry out their daily activities. These applications can be accessed through the companies Virtual desktops their by maintaining the security and integrity of the system because these are front end there are huge opportunities to misuse the system.
