As firms prepare for the roll out of phases 5 & 6 of the Uncleared Margin Rules (UMR), along with the preparation of their IM calculation and counterparty agreements they need to grapple with the expected IM volume increase and the challenges that this involves. 

9500 new relationships 

Managing the instruction process, along with the matching and covered status at multiple triparty agents and across an increasing number of accounts, whilst also dealing with the emerging new triparty agents and settlement structures, means firms need to deal with an increasing level of complexity and operational risk.  A challenging enough task for those that have developed capabilities during phases 1-4, but often overlooked by those in the latter phases.

As the number of collateralised IM relationships expand, in addition to simply increasing their STP rates, firms also need an improved view of their triparty activity.  As collateral giver this is driven by a demand to optimise their collateral usage and, as a collateral taker, they have a fiduciary or regulatory obligation to independently ensure that the collateral they are pledged meets the eligibility, valuation, and exposure terms they have agreed.

As firms prepare for phases 5 & 6, both those already live and those going live, the question is – do you have the right connectivity and collateral management capabilities to support this?

Pirum has a comprehensive suit of services to help firms manage IM processing and eligibility and provide firms with tools to help manage collateral efficiency.

 

IM INSTRUCT

Pirum simplifies connecting to Triparty agents and automates the processing and management of agreed margin values from our client’s upstream systems, allowing firms to manage this in one place.

  • IM instruct supports exception-based workflows for 1-sided and 2-sided matching
  • IM instruct has instruction lifecycle management including the automation of cancel and re-instruction process

 

VISIBILITY

Pirum CollateralConnect Service provides real-time, intraday oversight and analysis on exposure collateralisation across triparty agents as well as bilateral counterparts. Includes both pledge and receive segregated initial margin accounts

  • Exposure balances can include both agreed as well as projected exposure amounts
  • Balances includes encumbered collateral allocations and available longbox unencumbered positions

 

ELIGIBILITY

Pirum CollateralConnect Service provides a digitised schedule repository for all types of collateral schedules including OTC IM schedules.

  • CCS schedules can be captured via feeds from triparty agents or via a schedule manager tool where a feed is not provided by a collateral venue
  • CCS provides on-demand eligibility checking to ensure proposed or received collateral is appropriate and compliant with various regulatory jurisdictions

 

EFFICIENCY

Pirum CollateralConnect Service provides firms with the ability to manage collateral efficiency, sources and uses of collateral. 

  • Firms can quickly identify where assets can best be utilised using actual or theoretical baskets of securities
  • Adjust and mobilise securities where necessary

 

At Pirum we have 20 years of experience in helping manage the complexity of exposure and collateral processes, and now help clients manage over $1.5 trillion of collateral across 45,000 triparty accounts for Stock Loan, Repo and OTC derivatives.  Coupled with our expertise in process management, our CollateralConnect service helps firms manage the visibility and eligibility of pledged and received collateral, along with providing collateral efficiency and optimisation tools.

Connectivity is surprisingly easy, contact us to find out more.

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