BNY Mellon Embodied ISDA's Strategic Vision In New Service For Derivatives Dealers

The Bank of New York Mellon has developed a new, first of its kind netting service for derivatives dealers Derivatives Collateral Net. New service utilizes a patent pending technology that enables derivatives dealers to post only their net obligations against

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The Bank of New York Mellon has developed a new, first-of-its-kind netting service for derivatives dealers – Derivatives Collateral Net.

New service utilizes a patent-pending technology that enables derivatives dealers to post only their net obligations against all other participants in the system, greatly reducing their gross collateral requirements.

This innovative service automatically aggregates and nets overall collateral obligations, minimizing the collateral dealers are required to post and reducing the risks and costs associated with derivative transactions.

The new service represents a collaborative effort between The Bank of New York Mellon’s Office of Innovation and its Broker-Dealer Services business.

“Derivatives Collateral Net represents the implementation of the International Swaps and Derivative Association’s strategic vision for dramatically reducing the operational challenges associated with the margin process between counterparties,” says Art Certosimo, executive vice president and head, Broker-Dealer Services, Bank of New York Mellon.

“We’re making the process more efficient without affecting the fundamental bilateral nature of the credit relationship between the parties.”

“This service spotlights our unique ability to utilize our collateral management expertise and technology to anticipate and serve the emerging needs of our derivatives dealer clients.”

“Derivatives Collateral Net is the latest example of a new service developed in-house that improves our ability to service our clients,” says Kurt Woetzel, senior executive vice president and chief information officer, Bank of New York Mellon.

L.D.

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