CCP collateral and liquidity management strategy and vendor selection

Client context

In order to meet the demands of EMIR mandatory clearing, the CCP recognised the need to replace legacy margining systems and to align operating models across multiple geographies. However, to develop accurate business requirements the collateral strategy and operating model needed refreshing.

Project scope

• Collateral and liquidity management strategy: Our consultants developed a customer-driven strategy by interviewing board level stakeholders of the collateral unit, namely the clearing businesses. Combining these drivers with EMIR collateral segregation regulations we identified six strategic themes comprising 25 quantifiable objectives. We developed a target process and functional models, and secured top management sign-off.
• Collateral vendor selection: In this strategic context we developed detailed business requirements, published the vendor Request For Proposal (RFP), managed the long and short list decisions, facilitated the vendor selection, developed the implementation roadmap and established the implementation programme management office.

Benefits

The client was able to rapidly establish main board level approval of a revised business strategy, that addressed customer and regulatory drivers, and drive a rapid and efficient strategy-driven vendor selection that was subsequently implemented very successfully.