Collateral management for secured instruments

Secured instruments are a collateralised form of issuance. The issuer posts collateral at Clearstream’s German CSD as defined in the security's prospectus to cover the value of the issue at all times. Clearstream acts as a fiduciary agent on behalf of the investor and blocks the collateral to protect the investor in the event of a default by the issuer.

As the collateral is allocated in real time, the issuer only needs to collateralise the portion of the issuance that is sold to investors. Clearstream’s collateral management engine automatically allocates and substitutes the collateral and provides customers with comprehensive reporting.

Collateral management for secured instruments is an attractive service for both issuers and investors: investors benefit from lower risks and issuers attract a larger pool of investors.