Collateral: A Different Lens
July 2020

From the desk of Shaun Murray, Managing Director and CEO, Margin Reform

The Uncleared Margin Rules (UMR) which apply to non-centrally cleared derivatives will enter the final two phases of implementation on 1 September 2021 (phase five) and 1 September 2022 (phase six). While the original start dates were recently pushed back by the Basel Committee on Banking Supervision and the Board of the International Organization of Securities Commissions (BCBS-IOSCO), it is essential that the affected firms prepare for the new requirements.

A key consideration is the use of Money Market Funds (MMFs) as eligible collateral in the requirement for simultaneous gross two-way exchange of Initial Margin, pledging this to a segregated account at a third party using either a Tri-Party or Third-Party custodian mechanism.

Read my white paper which presents some of the key issues that the EU's Regulatory Technical Standards offer to those who use MMFs: the types of funds that could be used; how some of the solutions available can be accessed; and how they are likely to operate on a day-to-day basis.

.





This site, like many others, uses small files called cookies to customize your experience. Cookies appear to be blocked on this browser. Please consider allowing cookies so that you can enjoy more content across assetman.net.

How do I enable cookies in my browser?

Internet Explorer
1. Click the Tools button (or press ALT and T on the keyboard), and then click Internet Options.
2. Click the Privacy tab
3. Move the slider away from 'Block all cookies' to a setting you're comfortable with.

Firefox
1. At the top of the Firefox window, click on the Tools menu and select Options...
2. Select the Privacy panel.
3. Set Firefox will: to Use custom settings for history.
4. Make sure Accept cookies from sites is selected.

Safari Browser
1. Click Safari icon in Menu Bar
2. Click Preferences (gear icon)
3. Click Security icon
4. Accept cookies: select Radio button "only from sites I visit"

Chrome
1. Click the menu icon to the right of the address bar (looks like 3 lines)
2. Click Settings
3. Click the "Show advanced settings" tab at the bottom
4. Click the "Content settings..." button in the Privacy section
5. At the top under Cookies make sure it is set to "Allow local data to be set (recommended)"

Opera
1. Click the red O button in the upper left hand corner
2. Select Settings -> Preferences
3. Select the Advanced Tab
4. Select Cookies in the list on the left side
5. Set it to "Accept cookies" or "Accept cookies only from the sites I visit"
6. Click OK

From the desk of Shaun Murray, Managing Director and CEO, Margin Reform

The Uncleared Margin Rules (UMR) which apply to non-centrally cleared derivatives will enter the final two phases of implementation on 1 September 2021 (phase five) and 1 September 2022 (phase six). While the original start dates were recently pushed back by the Basel Committee on Banking Supervision and the Board of the International Organization of Securities Commissions (BCBS-IOSCO), it is essential that the affected firms prepare for the new requirements.

A key consideration is the use of Money Market Funds (MMFs) as eligible collateral in the requirement for simultaneous gross two-way exchange of Initial Margin, pledging this to a segregated account at a third party using either a Tri-Party or Third-Party custodian mechanism.

Read my white paper which presents some of the key issues that the EU's Regulatory Technical Standards offer to those who use MMFs: the types of funds that could be used; how some of the solutions available can be accessed; and how they are likely to operate on a day-to-day basis.

.