IHS Markit Releases Collateral Management Solution

Collateral Manager is a cloud-based solution for calculating margin, settling margin calls and managing margin disputes. It is a workflow solution with real-time reporting for automated processing of calls and exceptions. IHS Markit partnered with CloudMargin for the underlying technology with the vendor providing the needed data sets for running the calculations.

It covers cleared and non-cleared over-the-counter (OTC) derivatives, repos, stock loan, futures and options.

Laura Kholodenko, director for portfolio valuations and product manager for Collateral Manager, says putting the solution on the cloud makes sense as companies need to scale easily and it provides the needed operational efficiency clients want.

“Clients have several concerns around needing to meet the new rules; these can be around operational efficiency, cost, managing risk and optimizing collateral,” Kholodenko says. “A cloud-based solution provides easy onboarding and scalability as clients, including many on the buy side, must meet the new requirements.”

She adds that many clients rely on manual spreadsheets, which will be difficult to use when the number of calls increase and can be a risk to the firm, so a workflow solution like Collateral Manager may be able to help. Clients are also increasingly comfortable with the cloud so there is no reason for them to be hesitant to use a cloud-based solution. Kholodenko says the cloud makes onboarding easier and faster since it doesn’t require compatibility with existing infrastructure.

Collateral Manager sources data from IHS Markit’s other products including Portfolio Valuations, Counterparty Manager and MarkitSERV and directly integrates with those solutions.

Kholodenko says clients should be paying attention to how they manage collateral as volumes grow.

“You want to pay attention to it because the volume of collateral calls are sure to increase and we believe a straight through, automatic approach will be the best way to manage that,” she says.