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TriOptima Connects triResolve Margin Service with SWIFT Payments to Automate UMR Processes

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OTC derivatives post-trade services specialist TriOptima is extending its triResolve Margin collateral management service to support automated Swift payment capabilities. The addition of Swift connectivity means that TriOptima clients who are now in-scope for phases 5 and 6 of the BCBS/IOSCO Uncleared Margin Rules will be able to instruct Swift payments directly via the platform, allowing them to automate the full collateral management process across both initial and variation margins.

After the global financial crisis of 2008, the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) established minimum standards for margin requirements for non-centrally cleared derivatives, known as the Uncleared Margin Rules (UMR). The framework has been rolled out in stages because the operational requirements for financial services firms that are implementing it are significant.

In fact, acknowledging the size of the challenge for smaller organisations, BCBS and IOSCO recently extended the framework implementation by one year and created a new phase. There are now six phases to the project, with the final phase 6 taking effect on September 1, 2021. The Swift extension helps buy-side firms in particular, many of whom are now in scope because the BCBS and IOSCO also lowered the threshold point where they must undertake this obligation.

The enhancement to triResolve Margin collateral management service, which provides instant connectivity to the Swift network for cash transfers, securities settlement and triparty instructions, saves the cost and resource of an internal IT department building an integration into Swift, says Joakim Stromberg, product manager at TriOptima. Buy-side firms will be able to “automate both their margin calls and their settlements in one single platform” he adds.

Looking ahead, Stromberg says TriOptima is also investing in enhancing its dispute management work flow. “I think that dispute investigation will be key for the firms that are in scope for a regulatory initial and variation model to have this tight integration between the underlying data that builds up to the margin call because that’s where you need to identify the problems when you have a dispute. And we are really strong in that area and we want to further improve what we have there.”

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