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Collateral Management

ISS Magazine discusses collateral management with Alliance Bernstein's Chief Investment Officer, Erik Vynckier

ISS: There is a finite supply of safe assets that can be used as collateral and that pool is dwindling. What are the implications of this phenomenon in the short to medium term?

EV: The relevant question is not whether there are enough suitable assets globally to serve as initial and variation margin at clearing houses, but whether the potential collateral is held at the right place in the right legal entity.

For insurers who hedge liabilities or guarantees given to policyholders having to post sovereigns as initial margin and cash as variation margin forces them to hold sovereign bonds and maintain very liquid bonds which can be cashed in at low transaction or repo costs.  As a consequence, portfolio returns are depressed compared to the favoured asset allocation: corporate credit and illiquid high-margin lending.

Gresham Computing, a provider of transaction control solutions to international financial institutions and corporates, says that insurance broker Willis has selected its Clareti Transaction Control (CTC) solution for real-time matching and reconciliation of transaction data across its global business.

Clearstream reports that Banca d’Italia has followed Deutsche Bundesbank in choosing its Global Liquidity Hub to reinject securities purchased under the Public Sector Purchase Programme (PSPP) into the market.

Euroclear Sweden has affiliated a certificate based on the digital currency Bitcoin.


Enso Financial Analytics (Enso), a provider of data-driven investment and operational insights for hedge funds, has hired Julian Pittam as Head of Emea and Stephen Caplen as Global COO. 

Key themes emanating from the second day of Euroclear's 2015 collateral management conference were repo, the integration of the buy-side with the repo market, liquidity, innovation, regulation, and electronic trading. Securities Co, the Japanese online brokerage subsidiary of Mitsubishi UFJ Financial Group, has signed on to DataLend for securities finance market data.

LCH.Clearnet names new sales head

LCH.Clearnet Group has named Ali Hackett to the newly created role of global head of sales and relationship management.

Alpha becoming more popular

European institutional investors are switching to alternative assets, according to Mercer's 2015 European asset allocation survey, which identifies the relative paucity of attractively priced assets available to long-term investors as primary driving force. 

SGSS, Pioneer in Korea won move

Societe Generale Securities Services (SGSS) has launched a new share class hedging solution in Korean Won for global investment manager Pioneer Investments. 

NSD advances customisation

Russia's National Settlement Depository (NSD) and Neoflex, a provider of software and professional services in the financial markets, have completed the next stage of a project aimed at expanding opportunities for NSD information services users to receive, store and process corporate data based on the GoldenSource 360° EDM platform.

Euroclear Collateral Conference 2015: a summary

Euroclear has produced a summary of speeches and an audience poll at its 2015 collateral management conference in Brussels. 

SGPS offers CME portfolio margining

Societe Generale Prime Services reports that from today it offers CME Group portfolio margining for its clients. 

The way ahead for the Basel Committee

Stefan Ingves, Chairman of the Basel Committee on Banking Supervision and Governor of the Sveriges Riksbank remarks upon the current and upcoming work of the Basel Committee.


US earnings provide little cheer

US earnings provide little cheer, says James Butterfill, global equity analyst at Coutts.

Reversal of strong US dollar trend?

Michael Stanes, Investment Director at Heartwood Investment Management, puts the strong dollar trend under his microscope.


Mercer calls for pre-2016 DB, DC review

Pension schemes and their sponsoring employers need to act now to get ready for the state pension reforms in 2016, according to a communiqué just issued by Mercer. 

New home for Maisonneuve?

Where next for Virginie Maisonneuve? Once the excitement surrounding the news of her planned exit from her post as PIMCO's managing director and global head of equities portfolio management, attention will inevitably turn to her next move.


UK Election: The impact of unexpected political clarity

The unexpected clarity provided by the outcome of the general election has freed the UK economy from the shackles of uncertainty, leaving the domestic economy, and banks in particular, set to flourish, according to Steve Davies, manager of the Jupiter UK Growth Fund. 

Cyber security moves on to investment radar screen

The investment opportunities that the rise of cyber security might represent form part of the focus of a short note on the topic by Nina Hodzic, social and governance specialist at NN Investment Partners (formerly ING Investment Management).

Lloyd George knew his (great-grand)father

Argos Investment Management is partnering with a new asset management company headed by emerging markets veteran Robert Lloyd George to target professional investors with a new, long-only, UCITS fund focused on emerging market high growth sectors.

BofE report: not all doom and gloom

Commenting on the latest Bank of England Inflation report, Mark Taylor, Dean of Warwick Business School and Professor of Finance notes that the Bank’s revised economic forecasts paint a far from gloomy picture of the UK economy. 

How technology solutions can help asset managers with regulation and compliance issues

by Peter Raffelsberger, IT Architect, Pioneer Investments Austria

Fast growing demand for detailed portfolio data in high quality

The demand for very detailed portfolio data in high quality is continuously growing mostly due to new regulatory reporting requirements for both asset managers and their clients. Typically, the consolidation of data from various sources is required as well.

Transpacific gives Deutsche Bank ADR mandate

Transpacific Industries Group Limited has mandated Deutsche Bank as depositary bank for its non-capital raising sponsored Level I American Depositary Receipt programme.


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