Collateral Portfolio service

All Phase 1, 2, 3 and 4 dealers and banks have already opted to use triparty collateral management to meet their Reg IM needs.

Their buy-side counterparties will want to maintain existing relationships with their custodians and collateral management service provide.

Buy-side and sell-side firms can easily deliver collateral to meet their Reg IM obligations more effi ciently though a triparty collateral management solution in the books of the buy-side’s custodian.

In order to fully benefit from the Euroclear Bank solutions, the buy-side will need to be active within the same ecosystem as the sell-side.

Benefits

Who can subscribe?

Any custodian, administrator, asset manager, investment manager or collateral managers wishing to offer an alternative third-party solution to their underlying clients.

Legal agreement

In order to take advantage of this service you will need to complete the Triparty Collateral Service Agreement (TCSA).

Please get in touch with your relationship manager, or contact our experts listed below, to find out more.

Buy-side

• Easy access to the Euroclear Bank triparty solutions
• Use existing relationships. No need to set up direct access to the Euroclear ecosystem
• More efficient collateral allocation
• Faster collateral substitution
• Allows the use of complex collateral eligibility criteria and thresholds
• Collateralise derivative transactions and securities financing transactions

Sell-side

• Maintain business relationships with buy-side clients
• Continue to benefit from triparty services even as Pledgees in the books of the custodians
• Continue to use triparty standard instruction and receive collateral management reporting from Euroclear

Frequently asked questions

How does it work?

As the pledgor, you will indicate - from your available inventory - the collateral that can be used in order to cover the exposures with your counterparties.

Will my custodian also be involved?

You can indeed choose to involve your custodian in this process. If you decide to do so, information on the collateral available in the books and records of your preferred custodian will be sent to Euroclear through a Collateral Portfolio file – with the support of your custodian or collateral manager.

What will Euroclear do?

The Euroclear Bank collateral management system will check that the proposed collateral is available and in line with the pre-agreed collateral profile, defined at the level of your triparty agreement.

We will then assess its value and generate standard SWIFT messages which will be sent to your designated custodian in order for them to refl ect the pledged collateral positions in the their books and record.

How do you keep track of securities movements?

Your custodian will send Euroclear Bank settlement feedback messages and, providing settlement has been successful, our collateral management system will reflect the movements and we will then report back to the pledgor and pledgee.

Related Information

• Collateral management - UMR phase 5
• Pledgee Representative model
• Join the triparty community with full access
• Raise your question or enquiry

Contact

Olivier de Schaetzen

Head of Product Solutions - Collateral Management

Gösta Feige

Director, Product Solutions - Collateral Management

Product Solutions - Collateral Management

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