Service Initiatives

As it plays a key role across multiple asset classes, Deutsche Börse Group fully understands the importance of collateral management for accessing liquidity and credit risk mitigation.

By combining the services and strengths of the Group’s various entities, Clearstream is ideally placed to expand the award-winning Collateral Management Services for the benefits of a global customer base.

Major Expansion of Collateral Management Services

As the industry is experiencing record business volumes, expanding customer involvement and evolving industry issues, Clearstream has significantly increased its investment in new Global Securities Financing services. In 2006, this included a series of new services to meet the Collateral Management needs of customers:

A 'state-of-the-art' Collateral Re-use Service

This allows a Collateral Taker to re-allocate the collateral he has received from any triparty counterpart towards another triparty exposure. This can be used across all the Collateral Management Services where Clearstream acts as triparty agent including Triparty Repo, Triparty Securities Lending and any other exposure covered by more generic Triparty Collateral Management. Multiple re-use is possible with no restrictions on eligibility profiles, making it the first fully-automated cross-product and cross-quality collateral re-use functionality offered by a triparty collateral agent.

A multiple-collateral source account structure for AutoAssign users

In addition to the new re-use service, collateral providers using the 'Auto-Assign' functionality will also be able to define multiple proprietary accounts within Clearstream as collateral source accounts to provision their activities.

Automatic substitution pre-record date for custody income subject to tax

This new feature enables further optimisation of assets by allowing all collateral with an upcoming custody income event to be substituted automatically days before record/ex date, ensuring no further use of this asset until then. This is now done systematically due to the increasing diversity of asset classes handled and the impact of the multiple re-use of collateral on the right of the securities’ beneficial owners.

Enhanced Forecast Reporting Service

Collateral Providers now have the possibility to receive an enhanced forecast report, showing the total availability of collateral, including multiple source accounts and re-usable assets, against all counterparts and for any type of underlying collateralised transactions.

Straight-Through-Processing (STP) via SWIFT and CreationOnline

To enable greater levels of standardization, it is now possible to send all notification types for the Collateral Management Services via a Triparty Collateral instruction using either the SWIFT message format known as ‘MT527’ (already available today for Triparty Repo notifications) or; CreationOnline, the Clearstream44 secure web-browser connectivity solution.

These services ensure that companies can focus on their commercial operations, leaving increasingly sophisticated back-office operations a trusted partner with a unique understanding of both the operations themselves and their impact on all the parties involved.