The Obligation Warehouse service is a product of the National Securities Clearing Corporation (NSCC). The Obligation Warehouse service creates a common repository for trade capture and clearing transactions from the marketplaces, including the listed exchanges and alternative trading platforms collectively. It consolidates those transactions to reduce the burden of trade-for-trade settlement for each transaction. Additionally, NSCC provides a guarantee for specific transactions that are netted through balance orders or the CNS accounting service and settled either at NSCC, DTC, or another depository.
Benefits
The Obligation Warehouse service provides the following industry benefits:
- Central repository of open broker-to-broker obligations.
- Automate real-time matching / confirmations of ex-clearing, non-CNS obligations.
- Ability to manage and resolve exceptions, don't knows (DKs), in a more timely manner.
- Servicing of open obligations. Adjusting for corporate actions and scanning for CNS® eligibility daily.
- Risk mitigation and net capital relief through mark to market of open obligations.
Obligation Warehouse provides an automated service for the matching of open obligations in the same securities currently supported by RECAPS. The centralized service supports bilateral matching of fails and other ex-clearing obligations in real-time and communicates a successful match to both parties of the obligation. The database stores non-CNS matched open obligations from trade date through actual settlement date. RECAPS does not store open obligations after they are matched, netted, and re-priced.
Obligation Warehouse checks for CNS® eligibility, daily, and net, re-price, and re-date non-CNS eligible securities on more frequent basis than the current RECAPS. Obligation Warehouse also adjusts matched fails for mandatory corporate actions. In addition to securities covered under the current RECAPS system (equities, municipal bonds, corporate bonds, and UITs), the Obligation Warehouse tool includes receive and deliver instructions issued by the Automated Customer Account Transfer Service (ACATS).
Obligation Warehouse Web
The Obligation Warehouse Web system is a secure, browser-based, and efficient tool that you can use for obligation entry and reporting. The commands and data are validated in real-time, input errors are reported immediately and invalid data elements are returned directly on the entry screen. Delays associated with batch processing and manual comparison should be significantly reduced.
Each obligation submitted, along with the subsequent related events, are sent to the Contra to provide both parties with the most updated status. Every obligation is accessible for viewing, regardless of status. Aged obligations are recognizable quickly to assist operational areas in the confirmation and resolution processes. To learn more, see Obligation Warehouse Users.