DTCC Wins 2005 Best Utility Technology Award From Operations Management.

NEW YORK -- The Depository Trust & Clearing Corporation (DTCC) has been recently named the winner of the Best Utility Technology Award for 2005 by Operations Management for its work in promoting automated OTC derivatives processing.

The award is part of the publication's fourth annual Dream Team, recognizing top-notch financial industry operational efforts during the year.

Operations Management cited the significant momentum DTCC has achieved in developing its Deriv/SERV affirmation, matching and confirmation platform, the recent expansion of OTC derivatives supported by the platform, as well as its success in rapidly growing its customer base.

Accepting the award at a reception in New York City last week, Peter Axilrod, managing director, DTCC New Business Development said, "Although it says DTCC on the award, this is really something that was driven by the OTC derivatives community. It is through this collective commitment that automation rates, especially in the post-trade processing of credit default swaps, continue to rise. We are proud to be honored by Operations Management and our peers with this award. We'd also like thank our dedicated team of developers led by Vivek Pabby for their endless hard work in supporting the technology of our service."

DTCC entered the OTC derivatives market in late 2003, responding to requests from major dealers and banks looking to strengthen operational risk management and efficiency in a market place experiencing exponential growth. According to the International Swaps and Derivatives Association (ISDA), the notional value outstanding for credit default swaps (CDS) has grown nearly twenty-fold, from $631 billion in June 2001 to over $12.4 trillion at mid-2005. At the end of 2003, CDS notional value outstanding stood at just under $3.8 trillion.

First supporting CDS, DTCC Deriv/SERV's real-time, affirmation and two-sided matching and confirmation service has since expanded to include equity derivatives and interest rate derivatives. The service supports a wide range of trade life cycle events such as new trades, assignments, full and partial terminations, amendments, increases and exits through a flexible, fully automated environment. The Deriv/SERV platform also includes a payment matching and bilateral netting service for CDS.

"The breadth of the platform reflects DTCC's commitment to bringing to market a single automated processing service for a broad range of OTC derivatives products," said Janet Wynn, general manager, DTCC Deriv/SERV.

Deriv/SERV's customer base for CDS is the largest of any other post-trade service provider in the market place and includes 25 of the largest derivatives dealers globally and 123 buy-side firms, with a rapidly growing number of firms in the pipeline. These services are provided at no cost to the buy-side, while sell-side dealers are charged only at-cost. Over the past year, a growing number of front-office electronic trading service platforms have also linked to DTCC to provide the market with a fully automated, end-to-end straight through processing solution for OTC derivatives.

"We continue to work with a variety of complementary front-end electronic service providers as a way to further increase industry automation for OTC derivatives," said Axilrod.

The Deriv/SERV platform has been an important driver in bringing a higher degree of operational stability to the market's infrastructure. Axilrod commented that industry adoption of automated services is helping address concerns expressed by regulators related to the length of time involved to confirm trades using more manual, paper-driven processing methods. According to ISDA, automated confirmation of credit derivatives trades has grown from about 6% in the beginning of 2004 to over 40% by the end of June 2005.

"This is a faster adoption rate for automated OTC derivatives processing services than has been achieved with any other OTC derivatives platform," said Wynn. With market participants clearly focused on strengthening their operational infrastructure and a rapidly increasing number of clients using Deriv/SERV to process a wider range of trade event such as assignments, Wynn estimated that automation rates could go as high as 75% in the near future.

Other organizations that received recognition by Operations Management for their contributions over the past year to the financial industry's operational efforts include HSBC Bank as Innovator of the Year, Markit as Vendor of the Year, Fimat for Best Securities Processing and MiFid Joint Working Group for Best Teamwork. Joe Anastasio, partner and executive vice president, Capco received the lifetime achievement award.

About DTCC

The Depository Trust & Clearing Corporation (DTCC), through its subsidiaries, provides clearance, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities and over-the-counter credit, equity and interest rate derivatives. DTCC's depository also provides custody and asset servicing for almost two and a half million securities issues from the United States and 100 other countries and territories. In addition, DTCC is a leading processor of mutual funds and insurance transactions, linking funds and carriers with their distribution networks. DTCC has operating facilities in multiple locations in the United States and overseas. The derivatives services are provided through DTCC Deriv/SERV LLC. For more information on DTCC, visit www.dtcc.com.