Unsung Heroes: OCC’s Dan Busby

Sarah Rudolph

Sarah Rudolph


Dan Busby has his hands full as head of operations at OCC, but he insists he is having fun. 

He and his team are responsible for the back office operations for the world’s biggest equity derivatives clearing organization. OCC provides clearance, settlement and completes the life cycle of the trade for 16 options exchanges and four futures exchanges (they just added The Small Exchange on Monday) and is “really a 24×6 operation,” Busby said. And they are dealing with extraordinarily high volumes now, because of the coronavirus pandemic, while at the same time working on the Renaissance technology modernization project, which OCC has been “redoing from the ground up.”

The Renaissance project is “a massive effort” and the biggest initiative for the OCC in a long time, Busby said. They have been hiring recently for the project and are planning for as early as 2022 as the launch date. 

Back office operations at OCC start Sunday night because some of the futures markets open at 5:00 pm. There are six teams in operations: the market operations team interfaces with exchanges and monitors new listings and trade activity. Member Services is primarily about relationship management with OCC’s clearing member firms, Busby said. The collateral services team does morning settlement and collects what the member firms owe. The corporate actions team monitors options underlyings for any upcoming corporate actions such as dividends and provides investors with guidance. The external testing team responds to member requests for testing capabilities.

OCC began letting people work from home in early March and then went full work-from-home in mid-March. Busby is one of about 10 people who come into the office nearly every day. There is one operations person working out of the Dallas office (Mike Hansen – First Vice President of Market Operations and Dallas site leader), and two (including Busby) in the Chicago office. Two and a half months into the pandemic, staff have adjusted to communicating via video cameras and Webex. Like many companies these days, OCC uses Webex internally.

“There is even some benefit to the fact that you can reach people more easily because they tend to be at their desks,” Busby said. 

OCC recently contracted with Cinnober Nasdaq to build a new clearing system with primary development out of Stockholm, which sometimes necessitates Chicago staff getting up at 4a.m. to interact with the staff in Sweden. 

“There are some limitations with the whiteboard and the back and forth – sometimes one person can dominate the discussion, so you have to proactively ask people’s opinions and be patient with allowing them to state those opinions. But we haven’t missed a beat,” he said.

As everywhere, people miss having personal interactions. To help with that, the Operations teams continue to maintain their podcast and book clubs, and staff sometimes meet on their own through Zoom and house party apps, Busby said. The company has even made some new hires lately who have started their new jobs meeting people through video or chat.

The company’s CEO, John Davidson, has set the tone by making himself and other executives available. Davidson and COO Scot Warren have a twice weekly business continuity update for the entire company detailing the OCC’s current situation and plans, opening it up to questions so that anyone can ask the CEO leadership team about their concerns. 

“We can’t do our job without a robust technical infrastructure,” Busby said. Led by CIO Dave Hoag and his technology teams, the OCC has spent the past 2-3 years investing in its clearing system, Encore. 

OCC held its first OCC roundtable virtually, with a subsection of its clearing firms, and it went to all-virtual board meetings in April. 

“We have to continue to over communicate to our clearing firms,” Busby said. “Internally we use Slack channels, which people are really adopting to keep up communication. John [Davidson] reminds all of us to pick up the phone from time to time and call colleagues to see how they’re doing.”

As for the high volatility the market has experienced lately, it is “so far so good” with market operations. Volumes were at their height at the end of February, reaching 49 million contracts on Feb. 28, Busby said – the OCC’s highest cleared contract volume day on record.  OCC had the largest expiration in its history in March, “when markets were all over the place,” he said. He added that the Risk Management and Operations teams work closely with the clearing banks to make sure all accounts were funded. The collateral team supported the clearing members while seeing the largest settlement numbers in OCC history. 

“Also, with the volatility and circuit breakers, we got a lot of questions about what would happen if the markets were down 20% and they were halted and there was an expiration. So we updated the market closing guide on our web site. What if the Treasury told the exchanges to close? We have expirations happening three times a week at least! It’s so good that Stacey Cunningham and Steve Mnuchin said the U.S. markets will stay open, so we didn’t have to deal with those complexities along with volatility and a pandemic,” Busby said.

He added that with all of the market volatility there were also a number of complex corporate actions along with stock splits and reverse splits. “But our teams kept up.”

Busby sits on the SIFMA listed options committee and the listed options market structure working group. He said he has upped his one on one meetings and does a weekly management check-in to see how the staff is doing and talk about any issues with WFH capabilities and communication.

“It would be nice to actually see people in person, but that’s not our reality for a while,” he said.

OCC had a pandemic exercise in the fall of last year led by Clint Fransen, who heads up OCC’s Business Continuity program. Busby chairs the Crisis Management Team and works closely with Fransen to prepare the business teams for interruptions such as a pandemic.  Ultimately it was John Davidson and Scot Warren’s expertise and guidance that ensured they were prepared and provided the necessary communication to colleagues in Chicago, Dallas and Washington DC, Busby said.

“That tone from the top has brought really good feedback from people. John and Scot reiterate safety and health for everyone,” said Busby.

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