BNP Paribas Works with SWIFT to Enhance Collateral Protection

BNP Paribas Securities Services (BNP Paribas) is working with SWIFT to enhance its collateral protection solutions for corporate, buy-side and sell-side clients.

The two parties are working closely together to integrate SWIFT’s standardised messages supporting tri-party collateral flows within the bank’s ‘Margin Protect’ solution, which ensures compliance with the upcoming regulatory requirements on over-the-counter (OTC) transaction, mitigation of counterparty risk, asset safety and cash reinvestment facilities.

‘Margin Protect’ will also provide straightforward and more efficient management of all securities collateral operations, from instruction to substitution and monitoring,

“The more stringent requirements and the expected increase in volumes of collateral exchanged will make it difficult for firms to cope with a manual process still largely reliant on fax and emails,” said Philippe Ruault, head of clearing settlement and custody products at BNP Paribas Securities Services.

“The combination of our robust and efficient custody model with SWIFT’s secure messaging services supporting collateral management will benefit clients as it ensures collateral safety through a simplified access to account control arrangements (ACA).”

Collateral protection has recently moved up the priority agenda, becoming one of the top concerns for both market players and regulators. Over 10 regulations, in particular the US Dodd-Frank Act and the European Market Infrastructure Regulation (EMIR) have a direct impact on how to manage and protect collateral; meaning clients are facing considerable challenges in terms of accessing and managing collateral efficiently.


Related reading