Euroclear Bank is this year’s winner of the Most Innovative Project of the Year for its innovative Global Collateral Highway.
With the advent of regulations, which will force over-the-counter derivative contracts to be cleared by central counterparties (CCPs), collateral management has become one of the most important areas within the securities services profession.
With a quiet inter-banking lending market, Euroclear identified that central banks are playing a more important role in opening and maintaining liquidity flows for securities services companies and their clients. Euroclear wants to source and mobilise collateral across borders, and has already introduced triparty collateral management services to its ESES markets (France, Belgium and the Netherlands).
Euroclear has relationships with more than 90 central banks and many CCPs, and the Collateral Highway is already responsible for more than €500 billion of collateral movements every day.
Recognising the regulatory and changing post-trading world, Euroclear is focusing on helping firms unlock securities for use as collateral from different geographical silos by creating the right infrastructure.
Euroclear is working alongside BNP Paribas Securities Services to allow agent banks to make client collateral available for those sourcing collateral on the Collateral Highway. Alain Pochet, head of clearing, settlement and custody at BNP Paribas Securities Services, says: “This type of partnership is key for both organisations. It will offer even greater optimisation of collateral to our mutual clients by accessing the Euroclear Bank triparty platform, in addition to BNP Paribas’ in-house collateral management offer.”
Euroclear has developed an ‘open inventory sourcing’ technology for the important task of clients’ collateral positions. Euroclear can now source and manage all client asset positions via the Collateral Highway, automatically moving the right collateral to the right collateral taker.
Saheed Awan, global head of collateral management services at Euroclear, collected the award. He comments: “Winning this illustrious Custody Risk award is proof that we are delivering on our mission of creating the world’s first fully open global market infrastructure to source and mobilise collateral across borders, through what we call Euroclear’s global Collateral Highway.”
He continues: “This award is a fitting way to crown what has been a very memorable year. I accept this award on behalf of a very ddicated team at Euroclear, without whose help we would not have been able to realise this. We will not be resting on our laurels in 2013. We strongly expect to welcome further capital market infrastructure providers, central banks, clients and agent banks to the fast lane as we continue to support an ever-growing collateralised world.”