Score one for fixed income mutual fund back-office operations teams.Having received final approval from the Securities and Exchange Commission last month, the Fixed Income Clearing Corp. (FICC) will now permit buy-side firms, including mutual funds and other registered investment institutions, to join as sponsored members on a limited basis - a first for any Depository Trust & Clearing Corp. (DTCC) subsidiary.

State Street, one of the world's largest custodian banks, has signed on as the first sponsoring member and will begin submitting mutual fund client trades to FICC's netting process later this month. Officials at State Street, already an FICC netting member, were unavailable for comment, but according to FICC officials, State Street approached the clearinghouse several years ago with the idea that formed the basis for this new settlement model.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.