UK Regulator Deepens Partnership with Sopra Steria

The Financial Conduct Authority (FCA) is expanding its partnership with Sopra Steria, a French big-data specialist that developed and launched the Market Data Processor (MDP), designed to enable the FCA to capture, validate, store and track transactions in accordance with the revised Markets in Financial Instruments Directive (Mifid II).

After a competitive tender, the FCA selected Sopra Steria to provide application maintenance services across all of the UK regulator’s major systems. The new three-year contract extends the scope of work Sopra Steria has provided the FCA over the past 10 years. The previous six-year, £23.5 million ($32.4 million) MDP platform contract was awarded to the company in April 2016.

In the weeks following the Jan. 3, 2018, Mifid II deadline, WatersTechnology and Inside Data Management reported problems with systems operated by National Competent Authorities (NCAs), with sources reporting that the MDP was unreliable. The FCA initially denied any problems with firms submitting their data to the MDP, then confirmed a Risk.net report that the system was suspended on January 15.

“All of the issues were identified and fixed,” says Craig Wilson, Sopra Steria’s managing director of financial services. “All of the initial glitches were resolved, no data was ever at risk; it was all contained within the system.”

Wilson indicated that the problems had to do with stacking and securing data from “various different bodies,” including external sources.

“[Mifid II] was a huge launch of a new regulation across Europe and therefore the data, some of that information—this is the first time this was being dealt with,” Wilson says. “There have not been any glitches post-event. The system has operated in the way it was designed.”

The FCA appears to be satisfied with Sopra Steria’s work, as it has deepened and expanded the partnership since the Mifid II deadline. The FCA’s sole comment was a statement to Inside Data Management: “The FCA’s Market Data Processor has been accepting and processing transactions and we have seen no significant issues given the complexity of implementing the Mifid II transaction reporting requirement.”

Wilson says Sopra Steria is “very proud” of the MDP, “because of the way the system has been built to have a scalable solution, to make sure it can adapt.”

It processes an average of 31 million transactions per day, adding up to more than 6 billion as of October 1, 2018.

“[The MDP] operates at a time of innovation within the technology world, adapting to regulations that come from different bodies globally,” Wilson says. “The importance of the MDP is that it’s not a system that’s delivered and left alone; it has continuous releases, continuous improvements that come through to allow it to continue to adapt and improve.”

He says that over the coming year, Sopra Steria is operating a release program, “to continue to make improvements and develop the system, and also to make sure that we receive feedback on the system.” Wilson says the FCA passes along feedback from clients and then “we work in partnership on how we can make those changes. There isn’t anything I would say would be a fundamental change at this point. It’s more of an evolution of a system and the changes that the client and the partnership require.”

He adds that a “continual process of development and improvement has always been central to our work with the FCA and the proper management of any system operating at this scale,” and cites Sopra Steria’s “strong governance structure,” both at a development and senior level, as a key factor in its ability to receive and respond effectively to feedback and deliver the FCA’s “strategic outcomes.”

The MDP is a cloud-based platform and as part of the expanded partnership, Wilson says Sopra Steria hopes to help the regulator to move more of its systems to the cloud by 2022, an endeavor that “will involve lots of different elements of the FCA,” some with Sopra Steria involvement and some without.

According to Sopra Steria, that work will begin in early 2019 and will be provided via the vendor’s UK and India locations. The deal covers a wide range of capabilities including big data, UX and middleware, plus integration with Salesforce and Oracle technologies.

Sopra Steria is perhaps best known for its work with the UK’s National Health Service (NHS), a joint venture that provides services in finance and accounting, payroll and human resources, family health services, and commercial procurement.