Outline In March 2017 Variation Margin (VM) requirements for non-cleared derivatives went live. Counterparts entering into any non-cleared derivative trades with a notional value of $500k+ must agree and exchange VM bi-laterally daily. Initial Margin requirements are a little more complicated with a phased approach to implementation based on the outstanding notional amount of overall […]
Read moreLike all custodians without Securities Settlement System (SSS) status, this $1tn AUC custodian faces the loss of custody fee revenue when customer assets pledged as CCP collateral move into venues such as the iCSDs to meet EMIR 47.3 requirements.
Read moreHas the day of the collateral utility finally arrived?
Read moreRead about how the collateral industry has developed to the picture we see today, and how major regulatory impacts are re-shaping the landscape.
Read moreCustodians must recognise the impacts of clearing and collateral regulations on their customers, and anticipate their likely requirements for collateral services. In particular custodians must provide facilities for customers to allocate assets for margining cleared OTC, which must be held at a designated Securities Settlement System (SSS). Each firm needs a customer collateral strategy that […]
Read moreAs budgets firm up, strategic roadmaps must be developed into detailed plans that can be executed. The Field Effect can help with every aspect of delivery: Programme management Clearing and collateral subject matter experts Project / workstream management Programme Management office (PMO) Business analysis Architecture design Testing The Field Effect can help you plan, mobilise […]
Read moreBanks caught by BCBS/IOSCO regulations for margining non-cleared OTC derivatives must find a solution for initial margin calculation and dispute management. Several solutions are emerging, including industry-driven initiatives centred around AcadiaSoft and TriOptima, and commercial initiatives such as NetOTC. Whichever solution is chosen, banks must execute an efficient on-boarding project. Our approach covers: Business impact […]
Read moreFirms of all types may need to consider investment in third party technology or services. Buy-side firms typically have little collateral infrastructure; many sell-side firms recognise their existing collateral technology is not fit for purpose; custodians may not have suitable collateral management technology for customer needs. Fortunately many new collateral management software vendors, service providers […]
Read moreThe firm’s business operating model must be aligned with the strategy. Each firm needs to design a target operating model that addresses key dimensions such as: End-to-end processes for margin calculation, call processing (in and out), dispute management, FOP/DVP instruction, asset servicing, substitution, default management etc. Critical business functions, services and capabilities such as risk […]
Read moreThe larger sell side firms have been subject to mandatory clearing since 2016 and will now be exchanging bi-lateral VM & IM. Smaller firms will be exchanging VM already and need to ensure they are ready to exchange IM as they reach the phase-in requirements threshold. In addition firms with large customer franchises must decide […]
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