4sight Financial Software, which provides software and consultancy to the securities finance and collateral management industries, has launched a Collateral Optimization module for its Xpose Collateral Management system.
The solution allows financial firms to run automated availability checks based on a counterpartys acceptability and concentration schedules. The system will then propose the cheapest to deliver collateral within schedule.
The collateral optimization system can also run collateral allocations across all of a firms counterparts and across business lines such as securities lending, repo and OTC or listed derivatives.
This allows the system to show the discrepancy between the firms actual collateral cost and optimum collateral cost.
Collateral optimization is becoming of critical importance in making effective use of balance sheet due to forthcoming regulations such as Basel III and Dodd Frank, and the new module helps users to manage collateral supply and demand in a much more efficient manner, says Judith McKelvey, sales director of 4sight. We have seen a great deal of interest in collateral optimization from both clients and prospects, as the system will help them to retain vital liquidity, boost revenues and reduce their cost of collateral across business lines and asset classes.
(CG)