Barclays has officially opened registrations for the Barclays RepoHack 2023, an industry hackathon aimed at encouraging market participants to develop innovative solutions for repo post-trade services.
In an exclusive discussion, Lee Braine, Managing Director in the Chief Technology Office at Barclays, shared insights about the upcoming hackathon. This event will challenge participants to engage with new industry architectures to enhance the intricate landscape of repo post-trade services. A repurchase agreement (repo) is a form of short-term borrowing utilized in securities financing transactions, enabling firms to borrow cash while allowing investment firms to lend cash with minimized risk, as securities serve as collateral.
Given the current inefficiencies and outdated processes within existing systems, the sector presents ample opportunities for disruption. The daily turnover in the UK and EU’s repo market exceeds 130,000 transactions, valued at over £3.4 trillion.
Participants in the hackathon will focus on creating industry-wide data architectures and technology solutions to streamline trade flows and boost operational efficiency. They will leverage the Fintech Open Source Foundation (FINOS) Common Domain Model (CDM) specifically for repo transactions and utilize APIs provided by Barclays for market interactions.
The hackathon will include coding various stages in the lifecycle of post-trade processing for repo transactions, emphasizing interactions between counterparties and market infrastructure services. It will explore technology solutions to ensure consistency and accuracy of data across the industry, encompassing dealers, clients, and market infrastructures.
Braine noted that RepoHack 2023 has been in development for several years, with necessary industry alignments setting the stage for the event. A trade association took the lead in coordinating the creation of a draft version of the CDM for repos. The initiative follows previous focuses on interest rate swaps and collateral management.
As the draft for repo functionality was completed only recently, Braine highlighted that participants will have a unique chance to influence the standard’s trajectory. Engaging more market players at this stage will facilitate innovation in a more coordinated and efficient manner.
Participants will test the CDM and potentially suggest improvements to the open-source model. The hackathon’s timing aligns with the CDM’s maturity level, enabling firms to prototype solutions and evaluate their prospective utility.
Braine emphasized that adopting a new standard can be challenging, as it often requires changing established practices. Participants will have the opportunity to rethink their internal systems and consider how market infrastructures can implement their new solutions. This may lead to opportunities for banks to streamline existing infrastructures by delegating processing tasks to market infrastructures. Standardized processing using the CDM could ensure that firms achieve the correct processes efficiently.
The two-day in-person hackathon will occur at Barclays Rise London on September 27 and 28, 2023. Barclays anticipates registrations from a variety of financial institutions, tech companies, and fintechs from across the UK, EU, and US.
“This event presents a chance to drive transformation in the industry by promoting and refining standards that can be embraced broadly. Participants can experiment and engage with peers on cutting-edge developments. If firms have ongoing repo initiatives, they can explore how these efforts might align with the CDM moving forward,” Braine concluded.
Barclays is partnering with the International Capital Market Association (ICMA), the International Securities Lending Association (ISLA), the International Swaps and Derivatives Association (ISDA), and FINOS for RepoHack 2023. A panel of four industry judges will evaluate participants’ solutions and presentations:
– Lee Braine, Managing Director, Chief Technology Office, Barclays
– Peter Left, Head of Digital and Markets Innovation, Lloyds Bank
– Gabriel Callsen, Director, FinTech and Digitalisation, ICMA
– Minesh Patel, Chief Technology Officer, REGnosys
Industry professionals, including banks, market infrastructures, corporates, and fintechs, are encouraged to register by August 18, 2023.