Baton Systems Integrates with LCH to Deliver End-to-end Automation of the Collateral Workflow

Collateral Managememt

May 6, 20213 Minutes

Baton Systems has integrated with LCH, a leading global clearing house, to automate the end-to-end collateral workflow for derivatives participants.

Fremont, CA; May 6, 2021 – Baton Systems (“Baton”), a provider of post-trade solutions for financial markets, has integrated with LCH, a leading global clearing house, to automate the end-to-end collateral workflow for derivatives participants. J.P. Morgan will be the first of Baton’s clients to manage their collateral at LCH using the Baton platform. The partnership expands Baton’s network of central counterparties (CCPs) that now includes several of the world’s largest exchange operators.

Baton’s shared permissioned ledger integrates with existing collateral and cash systems of external providers, including CCPs and custodians, to enable real-time visibility and accelerated movement of assets.

“Baton’s integration with LCH is a significant milestone in our aim to have a comprehensive global coverage of CCPs on the platform,” said Anthony Fraser, Head of Global Clearing Operations and Cost & Commission Services at J.P. Morgan. “This will bring further efficiency in our collateral management process and will provide greater real-time visibility of our margin and collateral holdings.”

By normalizing and harmonizing data and collateral workflows for all integrated CCPs, Baton enables access to consolidated intra-day information in a single dashboard, with true visibility into the full collateral lifecycle. This includes visibility of margin requirements, a standardized process for pledging and recalling collateral, and clear visibility of the progress of asset movements at external custody banks and CCPs.

“The growing network of market participants on Baton’s platform is a testament to our vision of revolutionizing payments and settlements in capital markets,” said Tucker Dona, Head of Business Development and Client Success at Baton Systems. “With additional CCP connectivity, we are streamlining the collateral workflow process for market participants and enabling greater efficiency while also reducing costs typically associated with legacy systems.”

In 2019, Baton and J.P. Morgan developed a solution that enables the near real-time orchestration of cash and collateral transfers to multiple clearing houses. Baton’s platform is being scaled across global clearing houses and is available for deployment across all major derivatives firms.


SGX Partners with Baton Systems to Streamline Collateral Workflow

FREMONT, Calif.Oct. 14, 2020 /PRNewswire/ -- Singapore Exchange (SGX), Asia's most international multi-asset exchange and largest FX derivatives marketplace, has integrated with Baton Systems ("Baton"), a provider of post-trade solutions for capital markets, to automate and standardize the end-to-end collateral workflow for its clients.

Baton's platform normalizes and harmonizes data and collateral workflows for all integrated central clearing counterparties (CCPs). As a result, SGX's clients will have access to consolidated intra-day information in a single dashboard, with real-time visibility of margin requirements, a standardized process for pledging and recalling collateral and clear visibility of the progress of asset movements between SGX and themselves.

The resulting end-to-end automation of the collateral workflow process significantly improves operational efficiency. Accurate, real-time data is central to the optimization process.

"We are excited to partner with SGX as we continue broadening our CCP integrations," said Tucker Dona, Head of Business Development and Client Success at Baton Systems. "By expanding the scope of our CCP connectivity, we are enabling greater efficiency across the entire collateral workflow process for all market participants. Our customers and partner CCP's observed during the recent periods of volatility just how important this really is."

The deep integration provided by Baton also means that SGX will benefit from increased efficiency and reduced manual touchpoints when working with its clearing members.

"In today's low interest rate environment coupled with new margin rules for uncleared derivatives (UMR) transactions, collateral optimization is an important focus for clearing members globally, many of whom are SGX's clients," said Alison King, Head of Trading and Clearing Services, Equities at SGX. "As we look to innovate and continuously enhance our clients' trading and clearing experience, we partnered with Baton Systems to offer our clients visibility of intra-day margin data on SGX Titan derivatives and clearing platform, to reduce any friction associated with collateral movements, which is especially crucial in a market with increasing liquidity and activity."

With SGX on-boarded as its first Asian CCP, Baton is extending its network across the region and is in the process of expanding its office in India.

About Baton

Baton Systems is reforming how payments are made in the world's largest financial markets. By delivering on-demand synchronization and orchestration of asset movements through its distributed ledger-based platform, it is liberating balance sheets and eliminating the need for capital-intensive pre-funding of FX and margin requirements. Founded in 2016 by technology, payments and capital markets veterans, and backed by venture capital, Baton Systems works with numerous market participants – including major global banks, custodian banks and exchanges – to meet today's demands for capital efficiency, regulatory compliance and operational superiority. Find out more at www.batonsystems.com.

About Singapore Exchange (SGX)

Singapore Exchange is Asia's leading and trusted market infrastructure, operating equity, fixed income and derivatives markets to the highest regulatory standards. As Asia's most international, multi-asset exchange, SGX provides listing, trading, clearing, settlement, depository and data services, with about 40% of listed companies and over 80% of listed bonds originating outside of Singapore.

SGX is the world's most liquid international market for the benchmark equity indices of ChinaIndiaJapan and ASEAN and offers commodities and currency derivatives products. Headquartered in AAA-rated Singapore, SGX is globally recognised for its risk management and clearing capabilities. For more information, please visit www.sgx.com.