Collaboration will enable J.P. Morgan’s Collateral Services clients to benefit from an automated collateral optimisation process for cleared derivatives, across 13 CCPs globally

December 18th 2023, London Baton Systems (“Baton”), the global fintech digitally transforming post-trade processing, announced today its work with J.P. Morgan’ Collateral Services team, to enable tri-party clients to automate the optimisation of collateral to meet margin calls at a range of CCPs globally. Baton’s Core-Collateral® solution has been integrated into J.P. Morgan’s CCP Margin Exchange (CCPMx). 

Graham Gooden, EMEA Head of Triparty Collateral Management at J.P. Morgan commented “We’re delighted to help clients find increased efficiencies through improved collateral mobilisation in the clearing process.” 

Having gone live with the first CCP in November, the collaboration will enable the roll out of the solution across Baton’s extensive CCP network which currently includes 13 major CCPs across EMEA, North America and Asia, together comprising more than 94% of cleared margin posted by U.S. registered FCMs. 

As the higher interest rate environment continues to challenge derivative market participants, selecting the optimal composition to meet margin obligations is becoming critical. However, siloed data and manual collateral management processes often mean that understanding what collateral is available, selecting and then mobilising the most advantageous assets proves to be an extremely complicated, time-consuming and laborious task. 

Reimagining this process, tri-party clients can now easily aggregate all available collateral across their various sources into a single longbox, automatically select the most cost-effective securities and rapidly mobilise all assets. In doing so, they are improving the efficiency of the collateral management process, allowing more effective funding decisions to be made and reducing operational risk.

Arjun Jayaram, Founder and CEO, Baton Systems added: “We’re proud to be collaborating with J.P. Morgan to allow clearing members to most efficiently meet their CCP margin requirements. Through this partnership we are able to extend the economic value our Core-Collateral offering can bring to additional market participants which is proving increasingly important given the current environment.”

Baton plans to extend CCP connectivity globally with further CCPs expected to be added in the new year.


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