OTC & Collateral services

Securities Services

As a leading custodian with a complete suite of services dedicated to Over-the-Counter (OTC) instruments, we are ideally positioned to support you and help you reduce your operational and counterparty risks. Our suite of solutions is highly modular and covers a wide range of transactions.

Our OTC & Collateral solutions

BNP Paribas offers an end-to-end solution for OTC transactions such as repo, OTC derivatives and To be Announced (TBAs).

Our offering is fully compliant with the latest industry practices (e.g. ISDA, ERC) and regulations (e.g. EMIR, MAS, ASIC, FINRA 4210) leveraging expert teams, connected to industry working groups and regulatory bodies.

Leverage our global operating model and our regular stream of investments to attain operational efficiency, asset safety and collateral optimisation. BNP Paribas combines global reach with local expertise for optimal follow-the-sun capabilities.

Our suite of OTC & Collateral services is fully integrated with the rest of our offering, namely custody, depo bank, middle-office and fund administration services.

Discover our services:

Valuation of OTC instruments requires strong capabilities and expertise and an independent Mark-to-Market calculation of OTC positions is of utmost importance in highly volatile markets to ensure the right calculation of your margin calls and portfolio’s net asset value.

We offer a comprehensive, robust and sophisticated valuation service:

  • Covering a broad range of instruments from vanilla to exotic, cleared and non-cleared
  • Relying on recognised valuation partners to price all your portfolios in a single platform
  • With a strong control framework allowing full transparency of data to perform deep investigations

Our valuation service also supports the calculation of regulatory Initial Margins, under both Standard Initial Margin Model (ISDA SIMM) and grid methodologies, in a consistent manner with Mark-to-Market calculations.

View of airport departures area travellers rushing
Initial margin for non-cleared derivatives: the end of the journey?

Many market participants are now subject to the initial margin rules for non-cleared derivative transactions, is it the end of the journey?

Our solution encompasses post-trade processing and lifecycle management services, portfolio reconciliation and reporting to trade repositories giving you access to all market platforms through a single entry point (e.g. SWIFT, TriResolve, DTCC Global Trade Repository).

Use our transaction processing and lifecycle management services and benefit from:

  • Support for a wide range of OTC derivative instruments, vanilla or complex, Repo and Reverse Repo transactions (bilateral and triparty), TBAs and forward MBS
  • Real-time processing of your OTC transactions with workflows in line with the latest market practices
  • Seamless integration with valuation and collateral management services
  • Daily portfolio reconciliation of OTC derivatives positions via TriResolve
  • Daily reporting of all OTC derivatives transactions (transaction, position, valuation and collateral data) to DTCC GTR under EMIR, MAS and ASIC rules
  • Expert teams chasing breaks, investigating and communicating with your counterparties

Right from phase 1 of Initial Margin rules, BNP Paribas has offered a number of services and developments to help clients comply with the regulation. Should you already be in-scope of Initial Margin (IM) rules or potentially subject to them in the future, we offer an array of solutions to help you prepare and comply with the regulation, including:

  • IM calculations under either the International Swaps and Derivatives Association (ISDA) Standard Initial Margin Method (SIMM) or a table-based model leveraging our independent valuation capabilities
  • IM threshold monitoring of clients’ Credit Support Annex (CSA) exposure versus the pledger and secured party thresholds
  • IM reconciliation through Acadia, dispute management with drill-down into individual risk factors
  • Back-testing support by providing periodic back-testing reports
  • Connectivity to our fully fledged triparty collateral management platform to exchange and optimise IM for pledgers and pledgees, with an ISDA approved legal framework to ease legal negotiations
View of airport departures area travellers rushing
Initial margin for non-cleared derivatives: the end of the journey?

Many market participants are now subject to the initial margin rules for non-cleared derivative transactions, is it the end of the journey?

Acting as a bilateral collateral management agent since 2011, we support asset managers, asset owners and insurance companies for any collateralised transaction worldwide: cleared and non-cleared OTC derivatives, foreign exchange, repos, TBAs and Forward MBS (Mortgage-Backed Securities). We have designed a flexible solution that benefits from continuous upgrades to answer your evolving needs.

Choosing BNP Paribas as your bilateral collateral agent gives you access to:

  • Management of ISDA VM CSA (UK law, NY law), CSD, FBF ARG & DARG, German Bahrung, CMOF Garantia
  • Management of Repo GMRA
  • Management of MSFTAs (for TBAs and Forward MBS)
  • Management of cleared OTC agreements for Initial and Variation Margins
  • Support of net margining, gross margining agreements, commingled or segregated models
  • An open model, interfaced with multiple custodians and triparty agents and connected with market utilities and major valuation providers
  • Our smart allocation process that automatically selects securities to be delivered according to a waterfall of priority

Should you instead be interested in triparty collateral management, you can visit our dedicated solution page.

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