Background
The Baring Asset Management (BAM) operation was established in London more than 40 years ago. After being the first firm to open in Asia, BAM is now a truly global business with offices in many major financial centres throughout the world and £21 billion under management.

BAM has always taken a proactive approach to IT, recognising that new technology can provide a real competitive advantage in this market.

Automating Order Management
Baring Asset Management is no stranger to LatentZero. In fact the relationship goes back to the beginning of 2000 when BAM became one of the first users of Sentinel, LatentZero’s pre-and post-trade fiduciary risk and compliance management system. The implementation went well and Baring started seeing major improvements in its end-to-end compliance checking process, its internal control framework and risk management from the moment the system went live.

Nonetheless, when Baring decided that it was time to review the way they handled order management, LatentZero was certainly not the only choice.

The problem for BAM was that its old order management system, which was based on Access and Excel spreadsheets, was no longer appropriate for an expanding global asset management business that spanned four continents. It was slow, involved too much manual updating and was too detached from liquidity sources. It was also having trouble coping with the sheer volumes of trades.

Paul Savage, Head of Market Activities at Baring, explains that BAM had a vision to revolutionise the order management process and give the equity trading team access to the same sort of functionality, liquidity sources and real time data as any sell-side desk. It also wanted to be able to apply this across all asset classes, including equities, fixed income, money markets, derivatives and foreign exchange. Use of the FIX protocol to communicate electronically with brokers and counterparties was also an important criterion.

“BAM felt that it could not run an efficient buy-side operation on a global basis without a complete rethink of our Order Management System,” said Paul Savage. “Technology was needed that would enable us to be proactive with the markets rather than operate as a reactive, semi-clerical function. Above all, it had to integrate with our other front office software, as well as with our confirmation and settlement engines. The capacity to take a leap forward in Straight Through Processing was an essential requirement for us.”

Implementing Minerva
BAM were impressed with the LatentZero team, and the potential of Minerva, as a global order management system, especially its message-based architecture and compatibility with FIX, the order routing protocol.

“I have been struck by LatentZero's combination of detailed business knowledge and obvious technical expertise. Latentzero understood what BAM was trying to achieve from a business perspective and demonstrated how it could deliver this using Minerva. The product has given us everything we wanted on equities and we look forward to implementing the system for the other asset classes when we next upgrade. There is no doubt that this is technology with a long future ahead of it.”

Baring and LatentZero established a joint team and set some tough targets for the completion of specific enhancements to the software and subsequent implementation all within six months.

“This was where LatentZero’s combination of business and technical skills really came into play,” said Paul Savage. “They had to deal simultaneously with the equity trading team and with the Baring IT department throughout the implementation process. The fact that we were up and running exactly on schedule and within budget is a credit to both LatentZero and Baring Asset Management.”

The Benefits
Minerva has proved a stable and robust system and has enabled Paul Savage to deliver a centrally-controlled, global buy-side dealing operation. The product’s message-based architecture, access to FIX and therefore enhanced access to a wide range of liquidity pools has empowered the buy-side traders covering markets in Europe, North and South America and Asia to work as a global team and to drive up productivity. The traders themselves have been especially pleased with the performance and robustness of Minerva, the configurable screen blotters and the way the system locks on to liquidity sources.

“Quite apart from the fact that Minerva does exactly what we wanted, I have been impressed by the quality of personal service and support we have received from LatentZero,” said Paul Savage.