Five hundred to one thousand percent. That’s the eye-popping prediction of the coming increase in margin calls in a new report from US market infrastructure Depository Trust & Clearing Corp. (DTCC), “Trends, Risks and Opportunities in Collateral Management.” The trigger: new regulations and recommendations requiring far more transactions in far more asset classes to be collateralized. Relying on […]
Latin America’s MILA: Solving Settlement Quagmire
Mercado Integrado Latinoamericano, or MILA, sounded like a great idea. Announced in September 2009 and launched in May 2011, the initiative was supposed to bolster trading volumes in three stock markets, which historically languished in the shadows of Brazil and Mexico. The exchanges of Colombia, Chile and Peru would become the new Euronext. Or so […]
Margin Standards for TBAs May Edge Funds Out of the Market
Despite a six-month reprieve from collateralizing their US forward-settling agency mortgage-backed securities trades, many fund managers may be dismally unprepared for new margining standands, and shut out of the market. The answer won’t come easy or cheap: either upgrading or installing collateral management systems will be required. Then comes the cumbersome process of redrafting contracts or writing […]