SGX and Clearstream: the right collateral is priority
23 May 2014 Asia Pacific
Image: Shutterstock
Sourcing the right collateral is an increasing priority for the financial industry in Asia, according to the results of a poll conducted at the 5th Global Securities Financing Conference Asia.
Singapore Exchange (SGX) and Clearstream recorded a number of trends in the global collateral industry, following the poll of conference attendees. The conference is one of the first initiatives to come from the pair since they agreed last September to jointly develop collateral management services in Asia.
More than 150 delegates attended the conference, which focused on the recent developments around collateral management, securities lending and OTC derivatives in the Asia Pacific and worldwide.
At the conference, 93 percent of delegates agreed that sourcing the most appropriate collateral to cover global exposures is a priority, while 6 percent disagreed.
The poll results showed half of the respondents believed there would be a shortfall of eligible collateral over the next 12 to 24 months; 28.4 percent did not think so; 17.3 percent did not know and 4.9 assumed there would be a “significant shortfall”.
More than 80 percent believe they have more work to do in the move towards a more efficient collateral management solution, with 14.1 percent having “little” and 2 percent stating they have no work to undertake.
An efficient collateral management solution would be important for 44 percent of delegates, for them to hold their assets in Singapore as collateral. Competitive pricing, a trusted management provider and global connectivity were also drivers.
For 84 percent of the delegates, triparty repos will become increasingly attractive to corporates as a replacement to cash deposits, but 15 percent of delegates disagreed.
Stefan Lepp, head of global securities financing at Clearstream, said: “Our discussions with industry delegates in the Asia-Pacific region confirmed that we are on the right track with our SGX partnership and the execution of our recently announced joint collateral management service.”
Nico Torchetti, head of post trade at SGX, added: “Customers are increasingly concerned about the impact of the regulatory changes occurring outside of Asia and their ripple effect across the region. We look forward to offering a collateral management solution for the Singapore market and the wider Asian region.”
Singapore Exchange (SGX) and Clearstream recorded a number of trends in the global collateral industry, following the poll of conference attendees. The conference is one of the first initiatives to come from the pair since they agreed last September to jointly develop collateral management services in Asia.
More than 150 delegates attended the conference, which focused on the recent developments around collateral management, securities lending and OTC derivatives in the Asia Pacific and worldwide.
At the conference, 93 percent of delegates agreed that sourcing the most appropriate collateral to cover global exposures is a priority, while 6 percent disagreed.
The poll results showed half of the respondents believed there would be a shortfall of eligible collateral over the next 12 to 24 months; 28.4 percent did not think so; 17.3 percent did not know and 4.9 assumed there would be a “significant shortfall”.
More than 80 percent believe they have more work to do in the move towards a more efficient collateral management solution, with 14.1 percent having “little” and 2 percent stating they have no work to undertake.
An efficient collateral management solution would be important for 44 percent of delegates, for them to hold their assets in Singapore as collateral. Competitive pricing, a trusted management provider and global connectivity were also drivers.
For 84 percent of the delegates, triparty repos will become increasingly attractive to corporates as a replacement to cash deposits, but 15 percent of delegates disagreed.
Stefan Lepp, head of global securities financing at Clearstream, said: “Our discussions with industry delegates in the Asia-Pacific region confirmed that we are on the right track with our SGX partnership and the execution of our recently announced joint collateral management service.”
Nico Torchetti, head of post trade at SGX, added: “Customers are increasingly concerned about the impact of the regulatory changes occurring outside of Asia and their ripple effect across the region. We look forward to offering a collateral management solution for the Singapore market and the wider Asian region.”
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