The improving mobility of collateral assets, together with tougher requirements to post them, have taken the topic of collateral management from sleepy to hot in a short time. This panel session of PostTrade 360° Amsterdam, now available here as a video in its full half-hour format, checked the temperature.
Sell-side firms have even established new desks in response to the increasing frequency of collateral value adjustments. How are big institutions facing the new needs – and opportunities to free up capital – operationally? This question formed a starting point for the discussion, that took place at Amsterdam’s Eye filmmuseum on 13 October.
Moderator Marc Knaap, Strategic Partnerships, Cassini Systems, led panelists …
Martin Aasly, Senior Portfolio Manager, Investment Solutions, NN Investment Partners,
Staffan Ahlner, Global Head of Collateral, State Street,
Liam Huxley, CEO & Founder, Cassini Systems, and
Douwe Schering, Senior Collateral and Securities Lending Manager, MN.
The white dots in the player bar will let you shortcut to sections of the talk:
00:00 – Marco Knaap’s intro
01:40 – Speaker presentations
04:30 – Staffan Ahlner describes the scene
08:12 – Liam Huxley’s view
11:41 – Douwe Schering
16:03 – Martin Aasly, an investment manager’s view
20:14 – Collateral resilience
22:01 – Optimisation is established now
24:09 – Getting it set up
28:29 – Start from the big picture – then pain points
The session started with State Street’s Staffan Ahlner giving a detailed overview of the scene.
“We’ve seen the transition of collateral, from starting mainly as a sell side activity and now coming into the buy side more and more. And the debate has been going on for years; I think in particular that some very large funds in the Dutch market have been very vocal about the access to liquidity – and the need for liquidity – and have taken steps to be able to access that through clearing houses. So from that side, the trend – although we have been seeing it for some time – is that the sell-side tools are coming into the buy side, and that becomes a trend that people are working through. But the challenge we have seen is that these tools have largely been built in silos. In the sell side, they have been operating quite well in in these silos, but when you come into the buy side, that needs to be looked in a completely different way,” says Staffan Ahlner.
“The optimization challenge for a buy-side firm is completely different from a sell-side: you don’t have a capital requirement concern but you do have a liquidity plan to work with. So finding your optimal access to liquidity is a challenge that is both about organizing your data – making sure we are you know exactly where you need to be in what you have – and about having an ability to move the asset very rapidly to meet the obligation.”
• News around the PostTrade 360° Amsterdam event is gathered here.
• The 22-page pdf magazine, which includes the agenda, can be downloaded by clicking here.
• For a 3-page breakout of the agenda section, click here.
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