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:
Our solution encompasses post-trade processing and lifecycle management services and portfolio reconciliation giving you access to all market platforms through a single entry point (e.g. SWIFT, TriResolve, MarkitServ, ICE Link, DTCC).
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 Mortgage-backed securities
- Real-time processing of your OTC transactions with workflows in line with the latest market practices (affirmation/confirmation)
- Trade lifecycle management (coupons calculation, resets) and event management (credit event management for credit derivatives, management of options exercise).
- Seamless integration with valuation and collateral management services
- Cash flow settlement for bilateral and cleared trades including cash flow calculations and confirmations and automated instructions to the custodians (SWIFT)
- Daily portfolio reconciliation of OTC derivatives positions via TriResolve
- Expert teams chasing breaks, investigating and communicating with your counterparties
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 regulatory Initial Margin (IM) calculations, both the ISDA Standard Initial Margin Model (SIMM) and grid methodology, in a consistent manner with Mark-to-Market calculations.
Building on that capability, BNP Paribas offers a full compliance suite for clients that are or may become subject to IM rules:
- IM threshold monitoring of clients’ Credit Support Annex (CSA) exposure versus the pledger and secured party threshold
- IM reconciliation & dispute management via Acadia with drill‑down to individual risk factors
- Back‑testing – regular reports to validate model performance
- IM-What-If solution could be provided via our NeoLink Portal to visualise the IM impact of simulated trades.
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, New York 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 solution that automatically selects securities to be delivered according to a waterfall of priority
Triparty collateral integration – connection to our end‑to‑end triparty platform for IM exchange, Triparty Repo and optimisation, supported by an ISDA‑approved legal framework..
Should you in addition instead be interested in triparty collateral management, you can visit our dedicated solution page.
We have provided delegated reporting to trade repositories for non‑cleared OTC since EMIR launch and now support FCA (Financial Conduct Authority), EU EMIR (European Market Infrastructure Regulation), MAS (Monetary Authority of Singapore) and ASIC (Australian Securities and Investments Commission) regimes.
The service has been continuously enhanced (e.g., EMIR Refit) to ensure high‑quality, robust data while adding complementary capabilities:
- Retrieval and of Unique Trade Identifiers (UTI) and Legal Entity Identifier (LEI) into our transaction management system.
- Distribution of common data (trade details) and counterparty data (valuation and collateral exchanges) to the trade repository
- Reconciliation of trades, valuation and collateral data with data uploaded into Trade Repository
- Monitoring of acknowledgments from the Trade Repository
- Investigation in case of missing information or reconciliation issues
- Oversight dashboard available on NeoLink
The reporting service is performed through a state-of-the-art platform which allows us to submit on the trade date, creating buffer time to manage exceptions.
We reinforce accuracy and completeness through post reporting assessments including pairing and matching and error and omission support.
Many market participants are now subject to the initial margin rules for non-cleared derivative transactions, is it the end of the journey?