Integrating with Baton Systems’ expansive CCP network, BNY Mellon’s collateral management service will optimise and mobilise collateral across mutual clients’ cleared and uncleared collateral portfolios
December 6th 2022, London – BNY Mellon and Baton Systems (“Baton”), the global fintech digitally transforming post-trade processing using distributed ledger technology (DLT), announced today a new collaboration to integrate Baton’s market-leading Core-Collateral™ solution into BNY Mellon’s collateral management platform. This integration will enable mutual clients to optimise portfolio allocations and accelerate the mobilisation of cash and securities collateral across both uncleared and cleared margin obligations globally.
Victor O’Laughlen, Digital Business Leader at BNY Mellon said: “We’re excited about the tremendous potential this joint service presents to our clients, empowering them to optimise, mobilise and connect all of their collateral needs across different products and venues. Working with Baton, we will be delivering a solution at the leading edge of innovation.”
In today’s market, as interest rates and volatility continue to rise, the need for clients to manage and optimise the value and composition of the collateral they post across all of their relevant obligations is greater than ever. By bringing together the power of Baton’s established CCP network and BNY Mellon’s market-leading Enterprise Continuous Portfolio Optimisation (ECPO) service, the jointly distributed offering will support clients in reducing funding costs and improving profitability, while increasing the velocity of collateral to better manage risk. In addition, BNY Mellon’s collateral management system will orchestrate the collateral allocation workflow and reporting for a consistent client experience across triparty repo, securities lending, and cleared / uncleared derivatives margining.
Jerome Kemp, President at Baton Systems added: “We at Baton Systems are excited to be launching our collaboration with BNY Mellon. The union of Baton’s extensive CCP connectivity with the ground-breaking functionality of BNY Mellon’s ECPO service forms a powerful offering to cleared derivatives market participants. The rapid mobilisation of assets and the enhanced optimisation of margin collateralisation is a game changer for the market.”
Baton’s established CCP network, which includes major CCPs globally, comprising more than 93% of cleared margin posted by U.S. registered FCMs, is set to expand even further with work already underway to onboard additional CCPs across the globe in coming months.
The integration is contingent upon the execution of a definitive collaboration agreement, which is expected to be completed in the near term.