AcadiaSoft to release IM Monitoring Service
07 March 2019 Boston
Image: Shutterstock
AcadiaSoft is set to release an initial margin (IM) monitoring service to provide IM phase 4 and phase 5 firms with the ability to monitor their IM exposure and compare it to their estimated IM threshold to postpone negotiation and implementation of required legal documents.
According to AcadiaSoft, the service will create an industry-wide, authoritative data store of legal and operational collateral agreement information for over-the-counter (OTC) derivatives and simplify the integration process to new online credit support annex (CSA) negotiating tools.
It will combine existing aspects of AcadiaSoft’s Agreement Manager and its IM Exposure Manager service while offering connectivity with online document negotiation platforms to form a documentation negotiation and margin activation service.
Once a firm meets its maximum IM threshold, the service will automatically trigger the onboarding process for CSA and custody agreement negotiation.
The upcoming service is in response to guidance recently issued by the Working Group for Margin Reform within the Basel Committee for Banking Supervision and the International Organization of Securities Commissions, which suggests that global prudential regulators consider providing relief to bilateral OTC derivative market participants.
In providing guidance, the regulators emphasised their expectation that covered entities will act diligently when their exposures approach the threshold to ensure that the relevant arrangements needed are in place if the threshold is exceeded.
AcadiaSoft is due to release its Agreement Manager service in the second quarter of 2019.
Chris Walsh, CEO of AcadiaSoft said: “By removing the requirement to have legal agreements in place prior to a threshold breach, the regulators have introduced a new need to not only monitor IM thresholds but to have agreements quickly onboarded.”
He added: “By offering IM monitoring in conjunction with our agreement manager service, AcadiaSoft can identify when a CSA is required, and have it set up, calculated, margined and settled in a just-in-time manner using an industry-standard, automated process.”
According to AcadiaSoft, the service will create an industry-wide, authoritative data store of legal and operational collateral agreement information for over-the-counter (OTC) derivatives and simplify the integration process to new online credit support annex (CSA) negotiating tools.
It will combine existing aspects of AcadiaSoft’s Agreement Manager and its IM Exposure Manager service while offering connectivity with online document negotiation platforms to form a documentation negotiation and margin activation service.
Once a firm meets its maximum IM threshold, the service will automatically trigger the onboarding process for CSA and custody agreement negotiation.
The upcoming service is in response to guidance recently issued by the Working Group for Margin Reform within the Basel Committee for Banking Supervision and the International Organization of Securities Commissions, which suggests that global prudential regulators consider providing relief to bilateral OTC derivative market participants.
In providing guidance, the regulators emphasised their expectation that covered entities will act diligently when their exposures approach the threshold to ensure that the relevant arrangements needed are in place if the threshold is exceeded.
AcadiaSoft is due to release its Agreement Manager service in the second quarter of 2019.
Chris Walsh, CEO of AcadiaSoft said: “By removing the requirement to have legal agreements in place prior to a threshold breach, the regulators have introduced a new need to not only monitor IM thresholds but to have agreements quickly onboarded.”
He added: “By offering IM monitoring in conjunction with our agreement manager service, AcadiaSoft can identify when a CSA is required, and have it set up, calculated, margined and settled in a just-in-time manner using an industry-standard, automated process.”
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