Brown Brothers Harriman has partnered with CME to allow futures commission merchant (FCM) clearing members and other participants to custody their collateral with BBH.
Specifically, the partnership is for CME Clearing’s IEF4 program, which allows participants to deposit corporate bonds as collateral for listed derivatives and cleared OTC swap contracts in a tri-party custody account. Before adding the third option of BBH, CME Clearing firms could use BNY Mellon or J.P. Morgan as their custodian for these activities.
“BBH is focused on bringing flexibility, efficiency, and integration to all touch points in the collateral lifecycle. CME’s IEF4 program is an important part of this strategy as industry attention moves away from preparing for compliance with mandatory clearing rules, towards improving the efficiency of collateral solutions. Regardless of where in the collateral lifecycle an entity sits, this should be what they are thinking about,” says Stephen Bruel, head of Derivatives Product Management.
“Collateral management is an important service that we offer to all clients to help them capture efficiencies and put eligible CCP collateral to use,” says CME Clearing President Kim Taylor. “We appreciate working with partners like BBH to extend these services to benefit the broader industry.”
BBH Partners With CME for Tri-Party Custody for Corporate Bonds
Brown Brothers Harriman has partnered with CME to allow futures commission merchant (FCM) clearing members and other participants to custody their collateral with BBH.