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Irish Funds hopes blockchain will ease MIFF reporting burden

03 February 2017

MMIF reporting has proved challenging for fund administrators

Read more: reporting funds Ireland

Trade body Irish Funds is using blockchain technology to help investment managers and their fund administrators tackle a challenging reporting regime put in place by Ireland's central bank.

MMIF, short for Resident Money Market and Investment Funds Return, was introduced in 2014 and applies to all UCITS and hedge funds based in Ireland.

Stats on securities lending/borrowing, derivatives and overdrafts form part of the reporting requirements, intended to be more fluid and systematic than the previous OFI1 process.

Fund administrators have been doing most of the work on behalf of their investor clients. However, preparing the reports has been costly and demanding on internal resources. 

The sheer volume of trades executed by many high frequency trading hedge funds (often tens of thousands of trades a day) has caused difficulties in the reporting process. 

Most have found the timeline for submission (monthly for money market funds and quarterly for others) very tight. Ongoing changes to the regulation, made with little notice by Ireland's central bank, haven't helped.

Responding to a survey by RR Donnelley last year, an individual claimed MMIF reporting was "the bane of everyone’s life" at their organisation.

This week Irish Funds, the representative body for the international investment fund community in Ireland, revealed it is building a blockchain-based platform focused on MIFF.

Eventually funds, administrators and regulators will be able to access the distributed ledger system which could lower costs, boost transparency and ease compliance.

Northern Trust, State Street and Metzler are involved in the proof of concept which is being developed at Deloitte’s recently opened EMEA Grid Blockchain Lab in Dublin.

"Regulatory reporting is a key obligation for our members and an area of priority focus for the Central Bank of Ireland in 2017," said Irish Funds chief executive Pat Lardner.

"This project and the development of the proof of concept with Deloitte will benefit industry, the regulator and demonstrates how Ireland is actively embracing FinTech."

David Dalton, head of financial services at Deloitte Ireland, added: "Blockchain technology has huge potential in financial services to reduce the cost and improve efficiency. This is an important step in bringing this to reality."

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