This article was originally posted on Profit & Loss

Baton Systems, a provider of post-trade solutions for capital markets, says it has extended its FX functionality to address an increasing demand for a faster and more efficient FX settlement system. By deploying Baton’s core components, already in use across a number of global banks, Baton is delivering a fully end-to-end FX settlement ecosystem.

Baton is implementing three new functional modules that will be integrated into financial firms’ existing processes – the Pre-settlement Matcher, Settlement Monitor, and Liquidity Tracker.

The Pre-Settlement Matcher automates communication and the agreement process between counterparties on netted payment values. The Settlement Monitor tracks and reconciles inbound payments, allowing intraday updates on settlement risk, and actual or potential failed settlements. The Liquidity Tracker maintains available account balances and combines them with expected, completed, and pending incoming and outgoing payments.

Baton says that through its enhanced workflow for FX settlements, financial institutions benefit from a transparent, scalable, cost-effective and robust process from pre-settlement payment agreement, all the way through to optimised payment sequencing and same-day reconciliation.

“Capital markets have been hindered by legacy systems and a lack of effective monitoring and management of operational, counterparty and liquidity risk,” says Alex Knight, head of EMEA at Baton. “Baton is revolutionising an end-to-end FX settlement ecosystem by harmonising workflows and eliminating manual processes. As a result, our upgraded FX functionality is enhancing banks’ use of available liquidity and reducing settlement risk.”