Thursday, June, 13, 2024 10:53:35

The partnership will reduce counterparty issues and operational costs for customers using collateral management.

Financial Transaction Lifecycle Management (TLM®) solutions provider, SmartStream Technologies has recently announced its partnership with leading risk technology solution supplier, Numerix to better support its end users in complying with International Swaps and Derivatives Association’s (ISDA) margin requirements for non-centrally cleared derivatives.

According to reports, ISDA has proposed a Standard Initial Margin Model (SIMM™) in order to facilitate the Basel Committee on Banking Supervision and the International Organization of Securities Commissions’ (BCBS-IOSCO) guidelines for margin requirements relating to over-the-counter (OTC) derivatives which will be used by market participants to offer transparency in the collateral management space.

Reportedly, the automated data management solution of TLM Collateral Management has proven to reduce operational threats associated with the collateral management. Meanwhile, Numerix’s advanced computational abilities allow generating the risk sensitivities required by ISDA SIMM™ that are used as input into initial margin calculations.

Sources suggest that the partnership will hence reduce counterparty issues and operational costs for customers using collateral management for over-the-counter (OTC) derivatives.

According to a press release, Jason Ang, Program Manager, TLM Collateral Management, SmartStream, said that the company’s TLM platform can effectively manage credit and operational risk using collateral management. He said that the firm is delighted to be working with Numerix, whose expertise will match the company’s ability to manage complex business requirements in this space.

Commenting on the move, Steve O’Hanlon, CEO, Numerix, said that front-to-back SIMM™ calculations, including the development of fast and precise SIMM™ sensitivities, have become important as new transactions become dependent on initial margin requirements.

He said that the firm was delighted to partner with SmartStream to make its SIMM™ capabilities available to a greater set of market participants.

For the record, SmartStream is the leading provider of software and managed services that has outpaced its rivals in the financial market sector and has created an impressive base of over 1,500 customers which includes over 70 of the world’s topmost banks alongside leading asset managers, custodians and broker-dealers.