APRIL 2021

MANAGING THROUGH A PANDEMIC:
THE IMPACT OF COVID-19 ON
CAPITAL MARKETS OPERATIONSA WHITE PAPER TO THE INDUSTRYTABLE OF CONTENTSFOREWORD............................................................................................................................................................................. 1
INTRODUCTION........................................................................................................................................2
GLOBAL MARKETS BEFORE AND DURING THE PANDEMIC.........................................................................4
THE POST-TRADE LANDSCAPE: PANDEMIC TURMOIL AND RESPONSE......................................................5
Product and process challenges..................................................................................................................................... 6
The buy-side: an easier task at hand............................................................................................................................. 8
Shifting the operating model and increasing capacity............................................................................................... 9

IMMEDIATE PRIORITIES AFTER THE ‘BCP TEST OF THE DECADE’...........................................................10Growing consensus on need for process change and shift in working practices..............................................11
Emerging alignment on the need for process simplification and standardization.............................................11
Increased comfort with working from home models...............................................................................................12

LOOKING TO THE FUTURE.......................................................................................................................13

FOREWORD
The global COVID-19 pandemic and resulting economic turmoil sparked widespread changes to global financial
markets seemingly overnight – from record volume and volatility to significant spikes and valleys in a wide range ofasset classes, and new paradigms that will influence the role of the office and how we will work in the future. It has
been an unprecedented 15 months indeed.
While COVID-19 vaccination programs appear to be taking hold around the world and a return to normalcy is
within sight, the impact of the pandemic will be felt for many years to come. Unlike some historical events wheretime must pass for context and perspective, we already know that the pandemic marks an inflection point for
financial services and that we will never return to our previous business-as-usual approaches.
During the past year, we have gained insight into how firms are reprioritizing for a post-pandemic world, such as
focusing on addressing longstanding operations and technology issues, reexamining operating models, embedding
greater resilience throughout their organizations and placing a higher premium on collateral management,
reconciliation, accelerated settlement and the need for increased automation. At DTCC, we sought to learn more
about these opportunities and challenges by surveying market participants, with the support of McKinsey &Company, to better understand the implications of the pandemic on the capital markets. We at DTCC believe thefindings, which we are sharing with the industry in this report, will serve as a guide to defining areas of emphasis as
we collaborate to forge a better and stronger future.
The industry’s ability to successfully manage through the pandemic reinforces the resilience, agility and adaptabilityof firms to react and respond quickly to disruptive events. We have successfully navigated the crisis so far, and at
DTCC, we look forward to our continued partnership with our clients, regulators and other stakeholders in theyears ahead.
Michael Bodson
President and CEO, DTCC

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INTRODUCTION
In capital markets, as in the wider economic and social environment, the past year has presented significant
challenges. The COVID-19 pandemic is first and foremost a humanitarian crisis. It has impacted lives andlivelihoods, undermined economic activity, and caused intermittent bouts of financial market volatility. In early
2021, most economies around the world are operating well below their capacity. Capital markets participants,
meanwhile, are continuing to adapt to the new normal, and working to ensure that trading continues uninterrupted.
Amid record trading volumes testing operating models, and with corporate clients struggling to service debts andbeing forced to draw down on lines of credit, banks have faced significant challenges. Globally, banks provisioned$1.15 trillion for loan losses through the third quarter of 2020, compared with $800 million for the whole of 2019.1
At the same time, across global markets and investment banking, rising volatility created tailwinds in fixed income,equities and debt and equity capital markets.
In the post-trade processing space, record trading volumes in some asset classes coupled with the sudden shift toworking from home (WFH) put a significant strain on market operations. Many firms reported increased failvolumes in settlements, payments, and collateral-related processes. And yet, despite the magnitude of thechallenge, firms across the industry reported that post-trade operations (Ops) and operations technology (OpsTech)proved largely resilient.
These are some of the findings of a survey conducted with a global set of 35 buy-side and sell-side firms in
December 2020 and January 2021, focused on three areas – the short-term impact of COVID-19 on Ops and
OpsTech in capital markets; the immediate implications on firms’ operating models and priorities; and longer-term
lessons. The survey was supported by in-depth interviews with 15 leaders in the Ops and OpsTech space.
In summary, as survey respondents reflected on their firms’ performance during the height of the pandemic, threethemes emerge:• Cash fixed income and cash equities stood out as the asset classes most impacted by the market volatility,with 30-35% of firms across the buy-side and the sell-side reporting operational post-trade processing
challenges in these asset classes.
• From a processing perspective, settlements/payments and collateral/valuations were hardest hit, with 58% of
sell-side firms reporting challenges in settlement and payments during the peak of the pandemic.
• The sudden transition to a work from home operating model, with nearly all Ops and OpsTech personnel
working remotely, was achieved almost seamlessly, in most cases within a matter of days.
Reflecting on the events of 2020, several firms considered the pandemic an unusually prolonged businesscontinuity planning (BCP) event, for which they were better equipped compared to previous crises. Most firms wereable to effectively manage the combined impact of working from home and the increase in transaction volumes byrapidly redeploying resources and implementing tactical changes to their operating models.
Efforts made after the financial crisis and in recent years to reengineer and automate processes and upgrade
technology platforms were cited by firms as the main reason for their resilience during the pandemic. Indeed, alarge majority of respondents to our survey say that recent events have validated, rather than caused them toquestion, their Ops and OpsTech priorities and investment plans. About 90 percent of surveyed institutions reportthat the events of the past year have not caused them to materially adapt or accelerate their transformation plans.

1 McKinsey Global Banking Annual Review 2020, December 20202

Most of the interview and survey participants share the view that the pandemic in itself did not create an impetus
for change, however, an emerging consensus could be observed when it comes to firms’ immediate plans forchange in a number of areas:• There is alignment, across the sell-side and buy-side, on the need for further simplification andstandardization of some post-trade services which were hardest hit, in particular reconciliations, fails
management, and collateral management/valuations.
• Firms also cited the impact that the pandemic-induced volumes and volatility had on liquidity and margins,
and the need for continued focus on shortening settlement cycles, specifically for US securities.
• In each of these areas, over half of firms surveyed reported plans to either transform or increase capacity insupport of these processes and focus areas.
• The stigma around working from home and productivity has been removed, with many firms looking to retainpart of the remote and flexible working model post-pandemic.
In conclusion, feedback from market participants is overwhelmingly that they have passed the test of supporting
unprecedented trading volumes at a time when nearly all Ops and OpsTech professionals were working remotely.
While some firms may have targeted areas to address and further automate in their post-trade lifecycle, two topics
are likely to continue to inform strategies across the industry over the coming period — the future of WFH, which
remains uncertain, and the move toward shorter settlement times. By focusing initially on a move to T+1 for US
securities, firms can reduce counterparty risk and cut margin requirements, therefore lowering costs and freeing up
liquidity for the benefit of market participants and individual investors.

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GLOBAL MARKETS BEFORE AND DURING THE PANDEMIC
The capital markets industry has been characterized over recent years by relatively stable or slightly declining
revenue pools, ample liquidity, and strong asset market performance. Still, capital markets businesses haveremained under pressure, operating in an environment of low interest rates, shrinking demand for more complex
solutions, and tighter margins. Balance sheet de-risking post the 2008 financial crisis, and the subsequent evolution
to an agency-based model for many asset classes, have also undermined performance. Costs, meanwhile, haveremained high as a proportion of income, increasing pressure on firms to reduce expenses across the board,
including in operations and operations technology.

Some business lines have come under more pressure than others. Flow and highly electronic businesses (cashequities, FX, rates) have seen significant margin pressure, reflecting factors that include rising competition inmarket making, the growing role of technology, and a regulatory push for transparency, both pre- and post-trade.
In the early part of 2020, as the COVID-19 pandemic spread around the world with tragic consequences, financial
markets saw spikes in volatility that were unprecedented over the previous decade. The VIX index, or Wall Street’s“fear gauge” jumped from a reading of around 12 in January to 65 in March, amid significant selloffs across markets.
As investors rebalanced their portfolios, trading volumes skyrocketed on many days reaching two or three times the
pre-pandemic average.

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Exhibit 2: The VIX index jumped from a reading of around 12 in January to 65 in March

For capital markets, higher volumes were a positive. Indeed, many firms posted record revenues in the early monthsof the pandemic and went on to report a strong performance across the rest of the year. In the post-trade space,however, there were significant challenges along the way, with operations and operations technology teams acrossthe buy- and sell-side, custodians and other capital markets infrastructure firms working around the clock tosupport the unprecedented volumes and enable uninterrupted trading for their clients.

THE POST-TRADE LANDSCAPE:PANDEMIC TURMOIL AND RESPONSE
With global markets trading volumes soaring in the early months of 2020, and high levels of volatility persisting
throughout the year, market participants’ capabilities in the post-trade space remained under pressure. Among themost liquid asset classes, cash fixed income and cash equities stood out in survey responses as areas facing themost challenges, while post trade-services, settlements and collateral/valuations were reported to haveencountered unusually high levels of delay and fails.
Our survey reveals three key insights:• The challenges by asset class and operational process varied depending on the size and type of firm and its
business focus, as well as its track record of investment in operations technology.
• The buy-side was less impacted by the volume spikes than the sell-side. Broker dealers bore the brunt as theyneeded to reach out to and coordinate with hundreds of counterparties - clients and peers - to reconcile
breaks and settle trades.
• Transitioning into an operating model with nearly one hundred percent of Ops and OpsTech personnel
working from home was achieved almost seamlessly, and often within a matter of days. This was mostly due
to the resilience of firms’ core infrastructure, as well as their experiences from past BCP events.

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Product and process challenges
At the height of the pandemic in the early months of 2020, trading volumes rose to unprecedented levels (Exhibit1), even when compared to other historic events. Amid margin calls, dividend cancellations, coupon deferrals,
valuation changes and associated administrative requirements, some 30-35 percent of firms - buy-side and sell-sideequally - saw operational post-trade challenges in cash fixed income and cash equities.
After fixed income and equities, listed derivatives were the most-cited asset class, with 20-25 percent of firms
saying they struggled to keep up with processing demands, particularly in clearing. In a number of instances,multiple OpsTech releases were required to scale services, as some clearing brokers saw extraordinary dailyvolumes. The over-the-counter derivatives market was less severely affected, with fails concentrated among a few
broker dealers and client segments. However, money markets were impacted, with high numbers of corporate
events leading to increased post-trade disruption. The good news was that, despite these significant challenges,
there was no systemic event and the majority of firms were able to process volumes quite effectively and avoid
longer-term disruption.
The sell-side was most impacted in the fixed income business, with 47 percent of firms reporting problems. The
buy-side meanwhile saw cash equities, money market instruments, and secondary loans come under the highest
levels of pressure.

Exhibit 3: Asset classes most impacted by the COVID-19 pandemic

From a process perspective, settlements/payments and collateral/valuations were hardest hit. In the former, market
participants reported difficulties in obtaining settlement status, which in turn led to delays in matching and netting.
In OTC derivatives and repo, collateral processes were encumbered by sharp margin hikes. Collateral was also an
issue in exchange-traded markets, with fragmented schedules and uneven end-of-day remittances increasing
friction.

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Exhibit 4a: Post-trade processes most impacted by the COVID-19 pandemic

Size and scale of firms mattered when it came to the type of processes and asset classes impacted. Large firms on
both the sell-side and buy-side, as well as most quantitative traders, reported relatively few issues in cash equities,
but encountered more severe challenges in listed derivatives – mainly futures – and these were a significant causeof fails. Smaller firms faced issues uniformly across cash equities and fixed income.

Exhibit 4b: Post-trade processes most impacted by the COVID-19 pandemic

The absolute number of operational errors increased across the board. In fact, twenty percent of firms saw a spike7

in reconciliation errors. Still, the rise was proportionate to the increase in trading volumes. Where error rates
increased, the cause was usually platform breaks, rather than human or other operational shortfalls. Fail rates in the
US remained largely flat, on a per-trade basis, compared with pre-pandemic levels, while in Europe they increasedslightly – mostly attributed by the survey participants to the fragmented nature of the market. In absolute terms, ofcourse, they increased in both geographies in line with volumes. Asset servicing also came under pressure, amid
multiple dividend cancellations.
Challenges and disruptions to operating models, technology platforms, and products varied significantly by eachindividual firm, and often correlated with levels of past investment in those areas. Where processes failed, legacy
technologies (e.g., settlements and futures platforms) were often the culprits, and some smaller firms suffered froma lack of capacity.
For some firms, asset servicing was a particular challenge, as large numbers of companies canceled or delayed
dividend payments. Waves of paper-based corporate event notices prompted switches to electronic processing.
This brought high volumes of unstructured data into IT systems. As a result, firms with better data marshallingcapabilities and less fragmented tech stacks tended to outperform. For other firms, there were lesser but material
challenges in client services – including slower client outreach to resolve breaks and disruptions in onboarding of
new clients, to name a few. Firms also reported challenges in specific parts of their OpsTech stack but most wereidiosyncratic to each firm.
Where processes or parts of the IT function were outsourced, third-party vendors faced similar challenges. Some
50 percent of firms reported at least some vendor disruption, and not all firms had a robust contingency plan inplace with their providers. That said, more than 90 percent of survey participants report high levels of satisfaction
with third-party providers and just a handful of firms had to take processes back in-house.
Despite the severity and disparity of challenges, many market participants were able to resolve the majority ofissues within a matter of days, and without significant disruption to post-trade processing and client services.
However, it evidenced the need for a streamlined and accelerated post-trade processing and better use oftechnology. Efforts to overcome the challenges were supported by cross-industry collaboration, with teams making
use of online forums, and subscribing to several joint weekend sessions to reduce backlogs.

The buy-side: an easier task at hand
Most buy-side survey participants experienced less disruption to post-trade processes than sell-side firms. Their
most significant challenges related to position exposures, for example where record volumes and high volatility put
stress on collateral payments. Buy-side survey participants attributed their relative outperformance to their simpler
operational model when compared to the sell side, the need to coordinate with only few counterparties, and robust
digital transformation programs, at least for the larger firms. Still, there were exceptions to the rule. For example,
manual tasks in client services such as onboarding created practical difficulties for some organizations. Firms
running highly-automated trading strategies were also somewhat operationally stressed, for instance by the needto switch to manual reconciliations and create significant capacity to support issue resolution with theircounterparties.
Dealers, meanwhile, faced a different scale of challenge, reflecting their need to coordinate with hundreds or eventhousands of clients to resolve unmatched trades and fails. Sell-side firms uniformly reported challenges in reachingclients to resolve issues either because hundreds of clients contact information had to be updated or because ofincreased need for email or phone interactions required to resolve breaks. In a number of cases, the type and sizeof counterparties determined the problem. Highly quantitative firms, for example, sometimes did not haveadequate staffing to conduct the number of live interactions required and took days in some cases to respond totheir dealers, at least at the onset of the pandemic. Other times, it was dealers themselves that struggled to keep8

up with their peers, reflecting a sentiment expressed in survey responses that the community could only be as
strong as its weakest link. “Banks can deploy multimillion-dollar budgets to automate their processes and achieve
extraordinary levels of efficiency internally,” one survey respondent says. “However, if a peer is not on the same
path, then we are all forced to switch to manual processes and reconciliations when facing the street.”

Shifting the operating model and increasing capacity
Two operational challenges marked the early days of the pandemic:• COVID-19 lockdowns and restrictions led to a sudden shift in working models, with nearly 100 percent ofoperations and operations technology professionals remaining at home, leading to significant operational,
technology, risk, and compliance challenges.
• Firms needed to create and redeploy capacity to support the operational services and asset classes under themost pressure.
Despite the difficulties, which materialized over a short period of time, firms adjusted quickly — in manycases through implementation of existing business continuity plans. In a matter of days, workforces of thousandsof Ops and OpsTech professionals were transitioned to a working from home (WFH) model, the success of which
was attributed by many respondents to the resilience of core infrastructure and existing arrangements forflexible working.
To ensure business continuity, some firms already operated distributed physical networks out of multiple locations.
This enabled them to re-balance process workloads and continue to work seamlessly. Further, when physicallocations of trading floors were closed by lockdowns or travel restrictions, they were still able to handle highvolumes of trades. Indeed, some firms say that having thousands of operations professionals logged on to the
network from home was “a non-event.” It was simple to transfer business phone lines to personal or cell phones
and critical applications for trade processing that could be accessed remotely performed well, without significant
disruption, outages, or delays. Firms were able to provide second screens, printers and other equipment, as
necessary, to ensure appropriate home office set-up. Almost all survey participants reported high levels ofsatisfaction and in some cases admiration for the resilience of their firms’ core infrastructure.
One reason for the market’s overall high level of resilience was their experience in dealing with volatility andbusiness continuity events in the past, ranging from severe weather events such as storms and hurricanes in the US
to Europe’s sovereign debt crisis to futures, Treasury, and FX flash crashes over recent years. Operations andoperations technology teams had learned from these events and developed robust contingency plans. For example,
after Superstorm Sandy in 2012, one firm introduced a one-day-per-month WFH model, while another already had
a number of employees alternating working from the office on Fridays. Several firms had a policy of flexible seatingon their operations floors, already enabling a culture of “I can work from anywhere”. A few firms reported having a
policy of flexible seating on their operations floors, and in some cases implemented a “campus” locations strategy.
These approaches, as expected, were major assets during the pandemic.
When it came to creating capacity to address increased volumes, firms resorted mostly to two measures:redeploying professionals to the most stressed services and leveraging tactical automation. Some 40 percent offirms reported that they were able to re-deploy talent within a matter of days, and only in very few cases did firms
need to resort to staff augmentation or re-hiring alumni. Many firms realized the benefits of internal mobility
programs, in which operations professionals rotate across roles. This created a shared knowledge basis and allowed
firms to move employees to supporting different processes. Not surprisingly, redeployments meant on-goingchange-the-bank (CTB) projects were disrupted, still, most firms say they adjusted quickly. Moreover, the net effect,
at least in the first few months of the pandemic, was a boost to productivity – people got more done from home9

than they did in the office, and the impact persisted through most of the year. That said, several firms reported
concerns about their employee’s ability to sustain performance and materially longer daily hour working hours overthe longer term, as well as the impact on their well-being.

IMMEDIATE PRIORITIES AFTER THE ‘BCP TEST OF THE DECADE’
While COVID-19 presented a significant challenge for capital markets operations and operations technology, whenassessing the pandemic›s impact on their organizations, the vast majority of survey participants drew on historicparallels with 9/11, the 2008-2009 financial crisis and Superstorm Sandy and often referred to the pandemic as the“BCP event of the decade.”
It is the consensus from our survey that the industry proved to be largely resilient, handling unprecedented volumes
while operating for the first time in its history with nearly all Ops and OpsTech personnel remote for all market
participants in what felt like a twelve-month BCP event.
Firms attributed their ability to react quickly and effectively to the significant investments made in scaling,
automating, and upgrading core operations and capital markets infrastructure over the past several years, as well as
the significant BCP tests they have encountered in the past. Major sell-side firms, in particular, saw their ability towithstand the spikes in trade volumes as validating their investments in BCP preparedness and in putting in place ascalable infrastructure through significant multi-year transformation programs.
Smaller firms identified a greater need to increase investments in operations across the board. A number of firms
shared they are actively looking into further streamlining connectivity and communication processes acrosscounterparties, dealers and clients to improve trade information sharing. Others report plans to automate their
futures platforms and upgrade workflow tools.
When it came to third party providers, only a handful of the thirty-five survey participants were planning toinsource processes while most - given positive experience with vendors - were more favorable to outsourcing as aresult of strong vendor performance in 2020.
These examples mainly reflect the desire of broker dealers, their clients, custodians and other capital markets firms
to address issues in specific operational processes, such as reconciliations, or parts of the stack, rather than a needfor end-to re-engineering of the post- trade space and supporting IT infrastructure and platforms.
“COVID-19 accelerated in select cases our strategy to go after scale as opposed to change it,” says one executive.
Given these dynamics, respondents predict Ops and OpsTech budgets will most likely remain in line with those ofrecent years with two thirds of firms across the buy-side and sell-side reporting no changes to their budgets for the
next two to three years.

10Insights emerging from the survey and industry interviews suggest three major themes emerging as a result of2020 events:

Exhibit 5: Majority of firms don’t currently see COVID-19 materially changing
post-trade processing across the industry

Growing consensus on need for process change and shift in working practices
While most companies in the industry shared the view that the pandemic in itself does not create an impetus forchange, survey findings suggest an emerging consensus when it comes to firms’ immediate plans for change in two
select areas:• The sell-side and buy-side are aligned on the need for further simplification and standardization of a specificsub-set of post-trade services which were hardest hit• The stigma around working from home and productivity has been removed, with many firms looking to retainpart of the remote and flexible working model post-pandemic, for Ops and OpsTech.

Emerging alignment on the need for process simplification and standardization
Reflecting on 2020, firms across the buy-and sell-side are broadly aligned on the need to tactically improve a
number of specific post-trade services that were hard hit during the pandemic. For the sell-side, these include
reconciliations and confirmations, while on the buy-side, fails and collateral management are top of the agenda.
More than half of firms surveyed are planning to either increase capacity, build new capabilities or re-engineer
post-trade processes.

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Exhibit 6: In response to the crisis, firms have started to review their processes

Increased comfort with working from home models
Before the COVID-19 pandemic, many firms offered working from home as an option, while others provided“campus” like building facilities to enable flexible and remote working models. However, pre-pandemic there was a
prevalent perception in the industry that WFH was sub-optimal. Three learnings emerged during the crisis thatchanged mindsets and attitudes:
1. The widespread availability and adoption of video conferencing, virtual whiteboarding and other digital tools
eased communication and collaboration. Firms reported growing levels of acceptance and adoption of digitaland virtual channels, enabling seamless collaboration for BAU processes and successfully making up for thelack of physical collocation.
2. Several “semi-manual” processes and their effectiveness and efficiency came into question. Physicalsignatures, four-eyes checks and printing outs of reports for supervisor review were examples of subprocesses that required re-engineering during the pandemic. But firms’ ability to step up to the challenge in a
fully remote environment and rapidly re-think sub-processes proved largely sufficient. As a result, several
firms reported that WFH is no longer viewed as a challenge to perform several services that were previously
thought of as only possible on premise.
3. A number of firms also reported that they considered the opportunity in the future to access new talentpools through WFH models and potentially – in more limited cases- new geographies for talent recruiting
outside of their current footprint.

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Exhibit 7: WFH

The big picture? It appears that the industry has reached a tipping point on WFH. And although many firms indicatethat there are still areas such as product development and change management projects that are negatively
impacted by remote-only interactions, and while there is widespread concern over sustaining company culture andthe ability to mentor and develop new talent when fully remote, most firms see an opportunity to transform theways of working leveraging a WFH model. Many firms, therefore, paint a picture of an emerging hybrid model for
Ops and OpsTech professionals, with employees potentially working from home 2-3 days per week.

LOOKING TO THE FUTURE
Looking back on twelve months of operating in an environment of unprecedented challenges, survey participants
saw years of investments in process re-engineering, automation and OpsTech platforms bearing fruit. The industry
was able to process soaring volumes with an - until recently unimaginable - near hundred per cent WFH operating
model, while avoiding material outages and disruptions. Each firm faced its own unique set of challenges, but theindustry proved to be largely resilient and successfully passed “the BCP test of the decade”.
When looking into the future and beyond the immediate and mainly targeted changes firms have in the works inresponse to the pandemic, one question still remains open: As one buy-side industry executive noted “(…) now that
resilience has been tested (...) what will be the industry’s leadership and innovation role?”
It is undisputed that multi-year efforts across the industry to develop new solutions, upgrade technology stacks andautomate processes with the goal to create post-trade scale were validated by the successful response to thepandemic. However, some firms asked whether there is a danger that the relatively-smooth passage of 2020 may
be a missed opportunity for step change that would create value in the longer run. “We’ve learnt [that] we can getinnovation and decisions much faster during this crisis” one firm reported, and “will it [therefore not] be better toreimagine legacy [post trade] debt rather than continuing to rationalizing [existing infrastructure]?”13

At the same time, market volatility and trading surges in the US equity market in early 2021 further highlighted theneed to continuously evaluate clearing speed and efficiency, collateral management and valuations across theindustry. And though these events were market driven, when considered together with the learnings from thepandemic, they still surface a number of important questions at this juncture for firms individually and for theindustry as a whole in terms of the next frontier of transformational initiatives to pursue.
When faced with this question market participants mostly cited three areas of opportunity for transformation: 1)
accelerated clearing and settlements coupled with improvements in capabilities around valuations and collateral, 2)predictive analytics, for example to support fails prediction by client and/or product, and unleashing the power ofadvanced analytics and technologies like machine learning to enhance operations, and 3) transforming the ways ofworking and re-imagining the future of work by leveraging WFH learnings not only around operating remotely, butmore broadly around process re-engineering and further automation.
To boost efficiency, remain relevant to clients, and unlock new sources of value, firms across the buy-side andsell-side, as well as custodians and technology and service providers will continue to explore these areas andrelated questions in their response to market demands in a post-pandemic world. A focus on innovation will be
required, as well as an openness to embrace collaborative approaches, common processes, and target operating
models that meet the needs of a high numbers of market participants.
During and in the immediate aftermath of the COVID-19 pandemic, the industry once again proved resilient, yet
opportunities for transformative change remain across the capital markets value chain. As the impact of thepandemic continues to play out, markets enter a new phase of record valuations, and volatility continues unabated,
the advantage could start to shift to firms making those bold choices to transform their operations and set new
standards for the industry.

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