Boston, MA, March 24, 2008
– A new report from Aite Group, LLC examines the correspondent clearing workstation market. The report evaluates the advisor desktops
of participating correspondent clearing firms, and their fit with the needs of financial institutions and RIAs.
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Correspondent clearing from an introducing broker/dealer perspective has stabilized into a largely
fixed market, with little room for growth. Correspondent clearing firms focusing on creating tools to foster organic growth with existing
client segments and tools for reaching new markets have seen positive growth. Conversely, firms that do not continue to evolve may lose
business to competition. Because of this, servicing existing clients through correspondent clearing workstations has become paramount to
success in this market. An understanding of customer segments and their technical needs can make a substantial difference in whether or
not a customer becomes a target for a competitor. While the core functional differences between firms' offerings appear minor, each gap
in functionality can mean a potential customer loss for those prospects that see that function as their particular pain point.
"Aite Group believes there is still work to be done to improve correspondent clearing workstations," says
Adam Honoré, senior analyst
with Aite Group and author of this report. "This is true across the board, but particularly when it comes to integrating tools.
A firm may offer portfolio balancing and trading, for instance, but the two do not yet work together."
For this study, which updates research conducted for Aite Group's November 2005 report, Staying Alert: Correspondent
Clearing Workstations Wide Awake To Retail Needs, Aite Group invited 10 correspondent clearing firms to take part. Of those, four -
Bear Stearns, National Financial, Pershing and Ridge Clearing - offered to participate in an extensive, 265-word survey and provide a
product demonstration. The survey focused on nine categories, including account management, cash processing, compliance and risk
management, document management, trading, portfolio and accounting, reporting and analysis, market data and work flow.
"While some people are discussing the real estate and prime brokerage opportunities attached to JPMorgan's acquisition
of Bear Stearns, this research indicates that JPMorgan will also be inheriting a fully integrated correspondent clearing platform
strong in institutional capabilities and reporting, which is the only correspondent clearing firm supporting futures and commodities,"
adds Honoré.
This 35-page Impact Report contains 17 Figures and four Tables. Clients of Aite Group's Retail
Securities & Investments service can download the report by clicking on the icon to the right. A subsequent report focuses on the
target market of each firm and how that firm differentiates themselves from
competitors.
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