Clearstream and Belfius Bank & Insurance of Belgium have agreed to develop a new collateral management service for bilateral trades, focusing on OTC derivatives and aimed primarily at corporates and medium-sized banks. The service will be white-labeled by Clearstream and offered to its clients.
The new outsourced service, the latest in a number of strategic partnerships created by Clearstream as it extends the reach and capabilities of its Global Liquidity Hub, a collateral management environment for asset classes worldwide.
The partnership with Belfius will enable Clearstream customers to further bolster the globally unified collateral pool that bridges the bilateral and tri-party worlds and will optimize collateral management across both cleared and uncleared OTC derivative trades by further reducing collateral fragmentation.
The new service will be compliant with the best practices and standards in the European Market Infrastructure Regulation (EMIR) that will be enacted this summer. Clearstream will particularly target mid-sized banks and buy-side customers and will offer margin calls, dispute management, portfolio reconciliation, legal contract review and administration, payments and settlements reporting, a cash reinvestment mechanism and collateral transformation.
Stefan Lepp, head of Global Securities Financing at Clearstream, said: With this unique service, we are able to address the growing pressure triggered by regulatory changes in the OTC derivatives world on a short time-to-market basis by combining the outstanding expertise of Belfius with the state of the art collateral management product range of Clearstream.
(JDC)