Free Site Registration

Focus On: Operations

Measuring Operational Risk: Part Science, Part Art |  Licensing Ops Execs: Great Idea, Bad Execution? |  Reducing Operational Errors With OTC Derivatives |  A DAY IN THE BACK OFFICE:
Eliminating Operational Risk at a Transfer Agency
 |  Giving a Single Name a Single Identity |  TOP OPS EXEC: Timothy Doar, CME Clearing |  TOP OPS EXEC: Mike Fish, SWIFT |  TOP OPS EXEC: Patrick Kirby, DTCC |  TOP OPS EXEC: John McCorvey, Gar Wood Securities |  TOP OPS EXEC: Jeff Gooch, MarkitServ |  TOP OPS EXEC: James Malgieri, BNY Mellon |  TOP OPS EXEC: Hans Hufschmid, GlobeOp Financial Services |  TOP OPS EXEC: Conrad Kozak, JPMorgan Chase

Eliminating Operational Risk at a Transfer Agency

May 4, 2011
By Chris Kentouris

The Melbourne, Australia headquartered global transfer agent, entered the U.S. market through its acquisition of Harris Bank’s transfer agency business in 2000. Since then the acquisitions of transfer agents EquiServe and US Stock Transfer and the transfer agent units of Fifth Third Bank, Sun Trust Bank; National City and UMB have helped Computershare grow its North American operation – including shareholder services –to account for about half of Computershare’s overall revenues of $1.6 billion in fiscal 2010.

Despite the popularity of emails and other social networking tools, most registered shareholders are communicating with Computershare not only via the Internet but also via “old fashioned” handwritten or typed letters as well as phone calls. Computershare must respond to 10,000 to 15,000 calls a day using about 450 call center executives in Canton, Edison, N.J. and Chicago; of those 225 are in Canton. Other representatives must open and often interpret thousands of letters daily, some of which are handwritten. It can’t all be done by machine.

Three dozen Computershare specialists working on the first floor of the three-story facility in Canton open and scan the letters each day. The day starts at 5 a.m. and ends at 11 p.m. Each specialist works eight hours.

“Some of the so called “white mail” requests can be processed without manual intervention because shareholders have checked a box on a predesigned form that calls for Computershare to sell shares, change their address, or enroll in a dividend plan,” says Charles Rossi, executive vice president of U.S. client services at Computershare.

That’s pretty straightforward. But any handwritten letters must be read to determine just what the shareholder wants and to ensure that the investor is actually authorized to make the request.

“For transfer requests, Computershare, like all transfer agents, requires a specific type of signature guarantee,” says Rossi. “Once scanned, the requests are electronically routed to the appropriate operations agent for processing. Computershare will also monitor just when the request was sent and how quickly it was fulfilled.”

A 'Penny' for Their Thoughts

For customer inquiries received electronically, Computershare has created “Penny,” a virtual agent that appears only online. This digital service representative is designed to put a human face on simple Internet inquiries about accounts and notices. In just three months after it was installed, Penny has gone from handling 12,000 inquiries per month to more than 42,000 inquiries.

Here is how Penny works: Computershare fed Penny questions and answers into a single database, which is combed any time a question comes through online. Shareholders can type in their questions and have them analyzed and responded. The most asked questions: how do I sell shares? how do I change my address? how do I transfer shares to another name and person?, and how do I purchase shares? Penny responds, drawing answers from a database of frequently asked and answered questions, as well as account records.

Download the Full Report