US fund managers will be spending the new year preparing for the operational and legal challenges arising from central clearing of most secondary trades in Treasury cash and repurchase agreements now that the Securities and Exchange Commission has approved the phased move. The mandated switch to central clearing for many transactions in US Treasuries will […]
Uncleared Margin Rules Phase Six: Five Step SCOPE Approach
With the fifth phase of initial margin requirements for uncleared swap transactions recently effective, collateral management and compliance managers at hundreds of fund management shops need to start preparing for the final phase of uncleared swap rules to avoid finding themselves in hot water with regulators or counterparties, warn operations and legal experts. Fund management […]
Initial Swaps Margin: Facing Final Custodian Interactions
Investment funds, which have to meet initial margin requirements for uncleared derivative transactions in 2020 and 2021, will soon find that their biggest legal and middle-office challenges could be dealing with custodian banks. Far more investment funds will be affected by the final phases of initial margin requirements than in the initial four phases, starting […]
Swaps Margin: The Final Sweep of Document and Ops Morass
For collateral management operations and IT managers at hundreds of small to mid-sized broker -dealers and fund managment shops the nightmare of handling the new regulatory-imposed initial margin requirements for uncleared derivative contracts has just begun. Phase four of the US and non-US regulations, effective September 2019, and the ultimate phase five version, effective September […]
FINRA’s TBA Margin Rules: Stuck in Government Limbo
(Editor’s update 1/31/2019) The Financial Industry Regulatory Authority has decided to give collateral operations and compliance managers a temporary break from complying with new margin requirements for covered agency transactions. FINRA has filed with the Securities and Exchange Commission a request to extend by an extra year to March 25, 2020 the implementation date of […]
FINRA Rule 4210: Managers Beware of Margin Calls
With less than 100 days left before new Rule 4210 of the Financial Industry Regulatory Authority becomes effective, broker-dealers aren’t the only ones that should be preparing for new margin requirements for to-be-announced (TBAs) transactions and other forward settling fixed-income trades. Even if indirectly, investment management firms will also be in the regulatory crosshairs. Time is […]
EquiLend, Prime Brokers Sued: Collusion or Fair Game?
Prime brokers harmed beneficial owners of securities by protecting their turf and sabotaging fledgling electronic securities lending platforms that could have helped buy-side firms earn more revenues from their loans. That is the claim of four US pension plans and one trading firm that have sued six mega US prime brokers and securities lending platform EquiLend […]
Form N-PORT: Managers Report Big Stress
Update 12/12/2017: Fund managers shouldn’t feel too relieved by the US Securities and Exchange Commission’s delay on when they must submit Form N-PORT. On December 8, the SEC said that fund managers can wait until April 2019 at the earliest to transmit their completed Form N-PORT to the regulatory agency’s Edgar system. However, fund managers […]
Middle-Office Blockchain: BNP Paribas, Broadridge
Recent announcements of blockchain pilots from BNP Paribas Securities Services and Broadridge Financial show how distributed ledger technology continues to make inroads into the post-trade arena. Both come with claims of operational efficiencies through a single indisputable source of data that reduces the potential for processing errors. BNP Paribas Securities Services project for corporate action […]
Countdown to US T+2: Five Last Minute Tips
It’s now or never when it comes being ready for the pending two-day settlement cycle in the US. With September 5, the day T+2 becomes effective, just around the corner, operations and IT managers are taking the opportunity to verify that their front, middle and back office systems are tweaked correctly. And that their counterparties […]