What's the issue?
Under EMIR, every trade reported must be matched between counterparties. If the two sides do not align on key details such as notional, UTI or trade date, the Trade Repository flags a mismatch.
How It Happens
Common causes include:
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Booking differences: counterparties apply different conventions or templates
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Timing gaps: one party reports before the other, creating temporary breaks
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Manual errors: even small differences, such as rounding on notional values, can block pairing
Why it matters
High mismatch rates undermine the quality of regulatory data. They can indicate weak controls and, if persistent, attract regulator scrutiny or remediation demands. If the numbers do not line up, supervisors often assume the processes behind them do not either.
Oversight in practice
Effective oversight means more than just tracking mismatch percentages. Firms should:
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Review daily reconciliation reports for pairing success rates
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Drill down into root causes by counterparty, desk or product type
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Use trend analysis to identify systemic patterns instead of one-off breaks
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Focus on process remediation, not just adjusting values after the fact
Final Thought
EMIR reporting only works if both sides tell the same story. Strong oversight ensures mismatches are not just spotted but are fixed at the source.
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