WELCOME e GAINS Participants Transitioning to e GAINS

WELCOME e. GAINS Participants Transitioning to e. GAINS Information Sessions

Hosts: Futures Industry Association (FIA) Clearing Corporation (CCorp) Markit Group Participants: e. GAINS Users (London, New York, Chicago)

Presentation Schedule (via Web. Ex) 3: 30 – 4: 30 p. m. (London time) I. Agreements: Transition EGUS to e. GAINS (Thursday, April 3; Tuesday, April 8) II. Trade Processing: Trade Flow, Layout, Reports (Thursday, April 10; Tuesday, April 15) III. Banking: Billing Cycle and Money Flow (Thursday, April 17; Tuesday, April 22) IV. Iterations: Implementation Feedback and Enhancements (Thursday, May 1) On-Site Training Schedule – London User training sessions shall be conducted in London June 9 -13 Details regarding time and location to follow

I. Agreements Purpose Transition and Validate EGUS Agreements and Rates to e. GAINS Fundamental Issue/Question How does EGUS talk to e. GAINS? Agenda Thursday, April 3 Tuesday, April 8 3: 30 – 4: 30 p. m. (London time) • EGUS/e. GAINS Agreement and Rate Uploads (FIA) o Electronic o Manual o Participant Set-up o Rate Verification o One-to-One Link: Agreement/Account #/Rate • e. GAINS Overview (FIA, Markit) o Role of Systems Providers o Participating Exchanges o Settlement Currency o System Access o Exhibit Review • Data Mapping (CCorp) • Learning Environment Access (CCorp) • Testing Module (CCorp) o Trade Load § Auto Upload § Manual o Individualized • Testing: Phases 1 -3 (CCorp) • Resource Links • Contacts II. Trade Processing Purpose Examine Exchange Trade Flow, Data Layout and Position Posting and Report Generation Fundamental Issue/Question How can I validate my trade data? Agenda Thursday, April 10 Tuesday, April 15 3: 30 – 4: 30 p. m. (London time) • Exchange Trade Flow and System Requirements (CCorp) o Overview: How does e. GAINS work o Trade Mapping § Exchange Codes § Product Codes § Platform § Transaction Source Codes o Deadlines (Agreement Changes and Maintenance) • Record Layout–Output Review (CCorp) o Detailed Character Layout • Month-End Cycle (FIA) • Trade Processing (FIA) o Rates o Position Reconciliation o Pay/Collect Reconciliation • Outputs: Reports, T+1 and Month-end (CCorp) o Confirmation / Change Processing o On-line o Data Files and Downloads • Resource Links • Contacts III. Banking Purpose Review Month-End Adjustments, Billing Cycle, and Money Flow Fundamental Issue/Question How are pay/collects managed? Agenda Thursday, April 17 Tuesday, April 22 3: 30 – 4: 30 p. m. (London time) • Participant Banking Instructions and Maintenance (FIA) • Banking Overview and System Functionality (FIA) o Confirmation of Banking Instructions (mechanics and deadlines) o Changing Banking Instructions • Month-End Processing Deadlines (FIA) • Third Party Billing • Reports (CCorp) • Managing Accruals (FIA) • Systems Testing (CCorp) • Resource Links • Help Desk • Contacts IV. Next Iteration Purpose Review Implementation Feedback and Systems Enhancements Fundamental Issue/Question What is the next step? Agenda Thursday, May 1 3: 30 – 4: 30 p. m. (London time) • Feedback – A Formal Checkpoint o Testing o Systems o Launch • Review Participant Wish List • Procedure for adding (new) FX Settlements (FIA) • Other Exchange Participants (FIA) • Reducing the Credit Window (FIA) • Resource Links • Help Desk • Contacts

Housekeeping – Addendum to Initial Presentation (April 10) • Within your firm, please appoint an e. GAINS Training Contact and forward the details (firm name, training contact name, telephone number, email address) to David Adam (dadam@futuresindustry. org, 312. 786. 3821) • In EGUS, Admin, Search Institution and Parties, Maintain Parties: Populate Exchange / Firm Code

Session 2. Trade Processing: Exchange Trade Flow, Data Layout, Position Posting and Report Generation Purpose Review Exchange (Eurex, ICE, Liffe) transmission of give-up trade data to e. GAINS. Fundamental Issue/Question How can I validate my trade data?

Session 2. Trade Processing: Trade Posting and Validation Agenda • Exchange Trade Flow and System Requirements (CCorp) – Overview: How does e. GAINS work? – Trade Mapping • Exchange codes • Product codes • Platform • Transaction source codes – Deadlines (Agreement Changes and Maintenance) • Record Layout – Output Review (CCorp) – Detailed Character Layout

Session 2. Trade Processing: Trade Posting and Validation Agenda Continued • • Month-End Cycle (FIA) Trade Processing (FIA) – Rates – Position reconciliation – Pay/Collect reconciliation • Outputs: Reports, T+1 and Month-end (CCorp) – Confirmation / Change Processing – On-line – Data Files and downloads • Resource Links • Contacts

Exchange Trade Flow and System Requirements (FIA) Continued Overview: How does e. GAINS work? Given a completed give-up agreement and rate schedule in EGUS, the e. GAINS system shall: • Obtain give-up agreement and rate from EGUS (daily download from EGUS to e. GAINS). • Receive the end-of-day give-up transaction file from the participating exchange(s). • Look up the execution agreement, account, rate, and calculate the give-up transaction fees. • Provide the participants T+1 reports and end-of-month preliminary and final reports. • Allow participants to review trade details, modify transactions, resolve discrepancies, and confirm or reject trade changes. • Complete the billing cycle, e. GAINS automatically debits and credits the clearing and execution participants respectively.

Exchange Trade Flow and System Requirements (FIA) Continued At launch, e. GAINS will support cleared futures and options give-up transactions executed on Eurex, ICE, and Liffe. Exchange product codes contained on the trade records are passed-thru to the e. GAINS users. In the event of differences between commodity codes/ticker symbols/product designations, e. GAINS defers to the Exchange code supplied on the trade record. e. GAINS will support eleven currency types (at launch). These include: CHF, EUR, GBP, ISK, JPY, NOK, PLN, SEK, TRY, USD, and ZAR. With respect to banking, FIA Tech is working with a global financial institution to process month-end settlements (i. e. , transmit and receive give-up payments). Settlement accounts at the financial institution reside in London for non-USD payments and New York for USD payments. e. GAINS recognizes the following participant types: Executing Firm, Clearing Firm, and Third-Party. Since participating Exchanges agree to transmit give-up trade data only to the degree that the counterparties are e. GAINS participants, please meet with your counterparties regarding e. GAINS participation. Permission agreements, authorizing the Exchange to forward give-up trade data to e. GAINS, must be completed in advance of e. GAINS participation and filed with FIA Tech.

Exchange Trade Flow and System Requirements (FIA) Continued e. GAINS Participant ID provides user access to view or update the trade records. e. GAINS Participant IDs are based on exchange clearing relationships and the maximum number of IDs is contingent on the number of firm mnemonics at the exchange. For instance, if an institution has two clearing firm affiliates at a respective exchange, e. GAINS may crate two user IDs. Even though e. GAINS can create distinct IDs per relationship , it is not necessary to create an ID per relationship since the institution may want to group all trade activity under one ID - see below illustrations. Complete the e. GAINS Participant – User Set-Up Information form to establish a firm profile. Contact FIA Tech with set-up questions.

Exchange Trade Flow and System Requirements (CCorp) Continued

Exchange Trade Flow and System Requirements (CCorp) Continued

Exchange Trade Flow and System Requirements (CCorp) Continued Trade Mapping CCorp worked closely (and continues to interface) with the Exchanges’ IT teams to receive test trade files, unpack the trade data and create templates for e. GAINS data integration. Record layouts and field parameters have been defined and daily transmission of Exchange production data is scheduled for mid-May. Following May’s receipt of production data, CCorp shall distribute a detailed, full-scale testing schedule (Phases 1 -3). • Exchange Codes Eurex: XEUR ICE: ICE Liffe: LIFFE Exchange codes, received by the participating Exchanges, are synched to related EGUS designations and populated into e. GAINS. • Product Codes The Exchanges use unique identifiers or strings of data to differentiate exchange, product, and class. This allows for standardization across trading systems, among service providers and with member firms. Communication therefore, with respect to product, is standardized and consistent.

Exchange Trade Flow and System Requirements (CCorp) Continued Liffe, for instance, constructs product codes by combining a description of exchange, derivative or product type, and contract name. For example: Currency Derivatives Product Code Designation: LFED and LOED L= Market code for London Financial Exchange F = Product type for futures (or O for Options product type) ED = Product code for Eurodollar (i. e. the underlying asset the derivative is based on) Conversely EGUS/e. GAINS does not display product codes but rather product groups and their codes. CCorp is working with the Exchanges and Markit to synch codes where required.

Exchange Trade Flow and System Requirements (CCorp) Continued • Platform Multiple trading venues or platforms (i. e. Liffe’s BClear and Connect) contain identifiers on the Exchange’s trade records that are passed-thru to e. GAINS. Therefore, for the sake of differentiating like products traded through different venues, e. GAINS recognizes one exchange (as opposed to separating platforms into exchanges) with multiple platforms (characterizing BClear as a separate platform not exchange). • Transaction (Trans) Source Codes Method of execution, or transaction source (client or desk), is defined in EGUS. With respect to populating rates into EGUS as well as retaining the rates in the firm’s back-office, the specific cost of execution is known. That said however, it is not certain if the Exchanges are able to capture and pass-thru to e. GAINS a method of execution indicator. Firms developed creative workarounds (current practice) to distinguish method of execution (adding a character to the account number, i. e. , tilde “~”) so as to reconcile exchange data to their books. Although functional, the work-around solution is not systematically practical for all participants. CCorp is working closely with the Exchanges to create a similar logic stream so as to capture the

Exchange Trade Flow and System Requirements (CCorp) Continued transaction source code on the trade record thereby foregoing the firms’ work-around. Upon completion, firms will need to identify the method of execution on the trade. Deadlines (Agreement Changes and Maintenance) At the end of the trade day, Exchanges transmit the daily give-up trade files to e. GAINS. Agreement and rate changes effectuated in EGUS are expected to be applied same day to the e. GAINS daily giveup trades received from the Exchanges. CCorp is negotiating the cut-off time (i. e. 4 hours prior to start of the batch cycle; 4: 00 p. m. given an 8: 00 p. m. batch) for effectuating a same-day change to an EGUS agreement or rate. Further, work in process relative to establishing a schedule for updating the system intra-day (i. e. populate updates hourly).

Record Layout – Output Review (CCorp) Detailed Character Layout Agreement Details EGUS Agreement ID Group ID New or Change Production or Test Customer Reference Agreement Type Creation Date Approval Date Update Date Effective Date Bill Who Profit Center EGUS 15033166 New Prod John Q. Customer Standard 4/01/2008 Clearing Broker 9400 e. GAINS 15033166 John Q. Customer 4/01/2008 Bill Carry Participant 9400

Record Layout – Output Review (CCorp) Continued Detailed Character Layout Parties Party Code Name Type Exch Firm Code EGUS 12345 ABC Securities Clearing Broker ABC LIFFE e. GAINS Accounts Clearing Accounts Description Effective Date Executing Accounts L 2400 London AG 4/01/2008 25001 L 2400 Carry Participant ABC 25001

Record Layout – Output Review (CCorp) Continued Detailed Character Layout Tiers Fut/Opt/Both Client Electronic Client Voice Desk Electronic Desk Voice EGUS Fut/Opt/Both. 50 1. 00 1. 50 2. 00 e. GAINS Fut/Opt/Both. 50 1. 00 1. 50 2. 00 Product Code / Group Trade Type Spread Y/N Rate Currency ED all Y USD contingent on exchange and/or firm pass-thru trade indicator

Month-End Cycle Management (FIA) Month-end processing deadlines include: Business Day 1 st Bus. Day Activity/Deadline Complete prior month trade processing 7 th Bus. Day (8 p. m. , EST) Deadline for executing firm to correct/adjust trades 15 th Bus. Day (8 p. m. , EST) Deadline for clearing firm to re-accept or reject trades 16 th Bus. Day FIA Tech enters debits into banking system 17 th Bus. Day Clearing firms’ accounts are debited; credit float begins Last Bus. Day Deadline for firms to submit bank changes (names, locations, accounts) 60 Bus. Day from debit End of float period (variable)

Trade Processing (FIA) Prior to launch, a detailed comprehensive review or parallel test will be conducted with production data. The test, conducted in three phases, will focus on rates, trades, and monies. Participants shall be advised of timing details and test scripts/scenarios when the schedule is finalized; ETA end of May. • Rates Q. How will rates I enter in EGUS appear in e. GAINS? A. On a nightly basis, e. GAINS retrieves all agreement and rate information from EGUS. The rates and trade details are viewable online as it applies to executed give-up trades (Illustration 1 is a typical report capturing daily give-up trades for executing participants).

Trade Processing (FIA) Continued Illustration 1: GNS 00001, Daily Report for Executing Participant GNS 00001 CLEARING CORPORATION MM/DD/YY GIVE UP AUTOMATED INVOICING SYSTEM (GAINS) HH 24: MI: SS TRADE DETAIL DAILY REPORT FOR EXECUTING PARTICIPANTS PAGE: No. EXECUTING PARTICIPANT: XXXXX - XXXXXXXXX --------------------------------------------------------------- P O B S TRADE EX CA CNTRCT STRIKE / / ORDER TRADE TR TR AGRMNT / G-U RATE G-U FEE T DATE EX EX COM MON YR PRICE C C NUMBER PRICE SR TY NUMBER CUR QTY S A --------------------------------------------------------------- CARRY PARTICIPANT ID: XXXXXX CARRY ACCOUNT: XXXXX CARRY DISPLAY ACCOUNT: XXXXXX EX ACCT: XXXXXX MM/DD XX XX XXX XXXXX X X XXXXXXXXXXX XX XX XXXXXXXXXXX XXX XXX X XXXXXX. XX X SUB TOTAL : XXXXXXX. XX CARRY PARTICIPANT ID: XXXXXX CARRY ACCOUNT: XXXXX CARRY DISPLAY ACCOUNT: XXXXX EX ACCT: XXXXXX MM/DD XX XX XXX XXXXX X X XXXXXXXXXXX XX XX XXXXXXXXXXX XXX XXX X XXXXXX. XX X SUB TOTAL : XXXXXXX. XX

Trade Processing (FIA) Continued Q. How does e-GAINS match rates on my trades? A. Exchange trade data contains counterparty, account numbers, and commodity codes which are cross-referenced against e. GAINS account and rate information (uploaded daily from EGUS and/or input direct into e. GAINS by the user). In the event a match is not found, users will receive an exception report indicating "no match" or unlinked trade. Q. Can you override a rate for a specific trade? For instance, on a one-off basis, I may choose to reduce my execution fee due to the size of the transaction. A. No. Rates cannot be overridden however the total give-up fee or charge for the transaction may be modified. The change, initiated by the executing firm, shall appear on the daily and monthly give-up reports.

Trade Processing (FIA) Continued Q. Will I be able to identify which rates originated from EGUS agreements vs. which originated from non-EGUS agreements? A. Yes. There is an indicator in the Rate Offload File for firms to identify EGUS rates from non. EGUS rates. Q. What happens if I add or change an agreement in e. GAINS that already exists in EGUS? A. When the next EGUS agreement extract runs, the agreements/rates will be replaced with the corresponding EGUS agreement. The rate changes, added direct to e. GAINS, will be lost. The best solution for managing rates is to modify EGUS.

Trade Processing (FIA) Continued • Position Reconciliation Position match-off between the participant’s internal ledger (books) to e. GAINS is the responsibility of the participant. e. GAINS provides no position or rate reconciliation tool to facilitate an automated comparison. That said, firms are encouraged to manage e. GAINS position details daily. In the event you seek to build an internal reconciliation tool, CCorp has defined the necessary record layouts and character parameters. Similarly, services are available for outsourcing the program and database construction (i. e. VVA Systems). e. GAINS trades are stored online for 45 days coinciding with the end of the monthly banking cycle. Markit however shall retain the historical files for recall.

Trade Processing (FIA) Continued • Pay/Collect Reconciliation Pay/collect match-off between the participant’s internal ledger (books) to e. GAINS is the responsibility of the participant. e. GAINS provides no position or rate reconciliation tool to facilitate an automated comparison. Q. Does FIA Tech manage e. GAINS pays and collects? A. Yes with respect to providing monthly pay/collect instructions to the banking correspondent. No, with respect to funds movement. The global financial institution processes the funds transfer(s) as instructed by FIA Tech.

Trade Processing (FIA) Continued Q. As an executing and clearing participant, will e. GAINS net my pays and collects? A. No. All payments are gross and viewed as unique and distinct transactions. Further, even though rates within the give-up agreement may be denominated in the same currency at multiple exchanges, clearing participants are debited on the 17 th business day and executing participants are credited on the 60 th business day following the clearing firm debit. Hence the timing of pay/collects preclude netting.

Output: Reports (CCorp) All end of trade day reports (available T+1) as well as month-end, reports shall be available for online viewing and downloading (ASCII text files). Reports are patterned after GAINS - therefore users, familiar with the former GAINS report (i. e. GNS 00001) content and layout, ought be familiar with e. GAINS report content and layout. • Confirmation / Change Processing In keeping with the monthly e. GAINS Payment Schedule, trade record changes (the responsibility of the executing firm) must be complete by the 7 th business day. The carry firm (carry firms have reject authority and rejects are typically done due to rate, account, adjustment, trade and/or payment discrepancy) must act on the change request by the 15 th business day. It is in the carrying firms best interest to monitor trade status changes (especially as the 7 th business day approaches). Changes are reflected in the preliminary monthly data files.

Output: Reports (CCorp) Continued • On-line e. GAINS provides an interface to query and obtain trade status (reflects daily and month-to-date detail of trade activity).

Output: Reports (CCorp) Continued • Data Files and Downloads Users are provided e. GAINS detail and summary reports recapping month-to-date executing and carrying firm give-up trades as well as month-end banking pay/collect details. e. GAINS output and data files mirror GAINS. The following illustrations provide examples of give-up reports: GNS 00002: Trade Detail – Daily Report for Carry Participants GNS 00003: Trade Detail – End of Month Report for Executing Participants

Output: Reports (CCorp) Continued GNS 00002 CLEARING CORPORATION MM/DD/YY GIVE UP AUTOMATED INVOICING SYSTEM (GAINS) HH 24: MI: SS TRADE DETAIL FOR THE DAILY REPORT FOR CARRY PARTICIPANTS PAGE: No. CARRY PARTICIPANT: XXXXX - XXXXXXXXX --------------------------------------------------------------- P O B S TRADE EX CA CNTRCT STRIKE / / ORDER TRADE TR TR AGRMNT / G-U RATE G-U FEE T DATE EX EX COM MON YR PRICE C C NUMBER PRICE SR TY NUMBER CUR QTY S A --------------------------------------------------------------- EXECUTING PARTICIPANT ID: XXXXXX EX. ACCOUNT: XXXXX CARRY DISPLAY ACCOUNT: XXXXXX CARRY ACCT: XXXXXX MM/DD XX XX XXX XXXXX X X XXXXXXXXXXX XX XX XXXXXXXXXXX XXX XXX X XXXXXX. XX X SUB TOTAL : XXXXXXX. XX TOTAL FOR EXECUTING PARTICIPANT : XXXXXX TOTAL REVENUE : XXX LESS REJECTED TRADES : XXX NET REVENUE : XXX COMBINED TOTAL REVENUE : XXX LESS REJECTED TRADES : XXX COMBINED TOTAL NET REVENUE : XXX

Output: Reports (CCorp) Continued GNS 00003 CLEARING CORPORATION MM/DD/YY GIVE UP AUTOMATED INVOICING SYSTEM (GAINS) HH 24: MI: SS TRADE DETAIL END OF MONTH REPORT FOR EXECUTING PARTICIPANTS PAGE: No. EXECUTING PARTICIPANT: XXXXX - XXXXXXXXX --------------------------------------------------------------- P O B S TRADE EX CA CNTRCT STRIKE / / ORDER TRADE TR TR AGRMNT / G-U RATE G-U FEE T DATE EX EX COM MON YR PRICE C C NUMBER PRICE SR TY NUMBER CUR QTY S A --------------------------------------------------------------- CARRY PARTICIPANT ID: XXXXXX CARRY ACCOUNT: XXXXX CARRY DISPLAY ACCOUNT: XXXXXX EX ACCT: XXXXXX MM/DD XX XX XXX XXXXX X X XXXXXXXXXXX XX XX XXXXXXXXXXX XXX XXX X XXXXXX. XX X SUB TOTAL : XXXXXXX. XX TOTALS FOR CARRY PARTICIPANT : XXXXXX TOTAL REVENUE : XXX XXXXXXX. XX LESS REJECTED TRADES : XXX XXXXXXX. XX NET REVENUE : XXX XXXXXXX. XX • COMBINED TOTAL REVENUE : XXX XXXXXXX. XX • LESS REJECTED TRADES : XXX XXXXXXX. XX • COMBINED TOTAL NET REVENUE : XXX XXXXXXX. XX

Resource Links Information, agreements, links and resources will be distributed when complete. These include: • • Legal Agreement links Timelines Frequently Asked Questions (FAQs) Learning Environment link Spreadsheet for test trade submissions Data Layout Specifications Phase 1 -3 Test Plans Report Types and Detail (45 Total)

Contacts FIA Tech Robert Drew, Consultant, 07812991191, rdrew@futuresindustry. org David Adam, Consultant, 312. 786. 3821, dadam@futuresindustry. org Ron Metcoff, Treasury Consultant, 215. 272. 6593, rmetcoff@futuresindustry. org Krystal Atha, Relations Manager, 202. 466. 5460, katha@futuresindustry. org David Wilson, Technology Project Manager, 202. 466. 5460, dwilson@futuresindustry. org Mary Ann Burns, Executive Vice President Industry Relations, 202. 466. 5460, maburns@futuresindustry. org CCorp Marc Mac. Quarrie, Client Services and Support, 312. 786. 5732, marc. macquarrie@clearingcorp. com James Woods, Vice President, Production Management Group, 312. 786. 5715, james. woods@clearingcorp. com Markit Tony Murljacic, Director, Head of Trade Processing Connectivity, 917. 441. 6349, tony. murljacic@markit. com

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