Optimization Archives

Collateral Management Technology Vendor Survey 2021 From Finadium Features Transcend

Posted on July 13, 2021 by Electric Pulp

Finadium featured Transcend in a new survey on Collateral Management Technology Vendors in 2021. The survey presents an inside look at the technology vendors who are leading the future of collateral technology – and the incredible feats clients can accomplish with them.

Finadium profiles Transcend as a solution to manage collateral, funding, and liquidity within distinct business lines and across the enterprise. By connecting data and processes across disparate systems, Transcend’s holistic solutions help clients run sophisticated analytics, optimization and automation.

“Transcend was purpose-built to provide the most advanced post-trade collateral optimization capabilities in the industry.”
– 2021 Finadium Collateral Management Technology Vendor Survey

Finadium subscribers can download the survey to learn more about Transcend’s role in driving more effective collateral management and collateral optimization, as well as some new functionality recently added to the Transcend platform.

Learn More About Transcend

Transcend empowers financial institutions to maximize enterprise-wide financial performance and
operational efficiency. Through real-time global inventory and collateral management and optimization
solutions, Transcend helps clients manage intraday liquidity, funding and regulatory requirements.
With seamless workflows that connect front office decision-making with back office operations,
Transcend’s innovative technology promotes smarter investment decisions and improved financial
performance.

Contact the Transcend team for more information on our fully integrated suite of solutions.

Counterparty Credit Risk and the Growing Complexity of Collateralized Businesses

Posted on April 12, 2021 by Electric Pulp

The last decade has seen a dramatic increase in the breadth and depth of collateralized businesses. Firstly, regulatory requirements now necessitate that large banks hold more High-Quality Liquid Assets (HQLA) in order to manage broader liquidity needs and mitigate counterparty credit risk. Additionally, previously uncollateralized products and industries require collateral such as OTC clearing, certain uncleared derivatives and TBA mortgage activities. Lastly, trading businesses have turned to financing liquid collateral for steadier, annuity-like revenue. This heightened focus on secured lending exists across all key financial services segments including retail broker dealers, institutional broker dealers and large banks. As a result of these changes, there is a greater need for companies to effectively manage scarce collateral resources.

While posting and receiving collateral has helped firms mitigate credit risks and create new revenue streams, it also adds further complexities for operations and risk management. Firms must now manage collateral received and posted across multiple business units, with varying margin regimes and customer types, under disparate legal agreements and collateral requirements. As a result, risk managers must now manage these various activities across the capital markets businesses and the enterprise.

We have seen risk managers particularly challenged by how to track margin calls generated from these disparate business activities to ensure counterparties remain effectively collateralized. Recent liquidations of large positions in Prime Brokerage businesses have proven that even in a lower volatility market, large margin calls necessitate active and intraday risk management of these exposures. Accordingly, firms must effectively manage their risk positions not only during periods of extreme market volatility, but also in times of market stability.

Collateral Management for Inventory Optimization

Now more than ever, it is important for firms to implement technology that aggregates and harmonizes collateral pools across the enterprise, including the “collateral profile” of these positions, in addition to intraday margin calls. These solutions can provide risk managers the ability to analyze transactions that produce or require collateral and margin calls that expose the firm to counterparty credit risk. The management of margin call activities is where counterparty credit and operational risks converge; firms need the appropriate technology infrastructure and operational processes in place to fully understand the terms of their contracts, status of margin calls, and current collateralization, thus enabling business and risk managers to mitigate potential credit risks.

Firms that have the operational capabilities to manage margin and collateral risks in real-time are establishing a competitive advantage in the market.

Transcend’s Intraday Margin Optimization Solutions are helping firms unlock real-time exposure analysis and superior collateral allocations to deliver firm-wide optimization with full STP connectivity. Learn more.

The Next Level in Building Data-Driven Operational Efficiency

Posted on April 16, 2020 by Electric Pulp

The next level of operational efficiency will incorporate a deep view of connected data within organizations that will yield better efficiencies and optimization of capital through firm-wide decision making. Taking automated action on those decisions for Straight-through Processing will enable firms to achieve the desired efficiencies in a scalable manner. Getting there has its challenges, however. In this article we look at why many in the industry are embarking on this more sophisticated approach to operational efficiency, and identify three key strategies for ensuring success. A guest post from Transcend, originally published in Securities Finance Monitor.