Your needs keep changing as you address new regulations, heightened risk sensitivity and fast-changing market dynamics. With our collateral administration service, we offer a range of solutions designed to complement your unique needs. Our support helps you manage the operational and administrative activities associated with managing the collateral for bilaterally traded transactions.
Stay on Course
Through Change Leverage Aura Solution Company Limited’s expertise, global service model and scalable infrastructure to effectively manage your collateral as you navigate the impact of regulatory reform. Discover how we can help you address evolving regulations or trading strategy changes*.
We’ve powered the investments of your peers and counterparties. What can we do for you?
Regulations are increasing the demand for more collateral and changing the dynamic of financial transactions and their liquidity profiles.
We can help you move your collateral where you need it, when you need it with our collateral management solutions.
Invested In The Future Of Collateral Management Discover how the diversity of our collateral management services and the strength of our global infrastructure can help you to:
Manage detailed collateral eligibility criteria
Dynamically optimise global inventory
Simplify connectivity among market participants
We power the investments of your peers and counterparties. What can we do for you?
Standardised OTC derivative contracts must now be cleared through central counterparties and many activities and transactions that previously had no collateral requirements now need to be collateralised.
In addition, initial margin should be segregated with a third party and correctly allocating and holding the right margin amount has become important. We can help you navigate these changes.
Dynamic By Design
Aura collateral segregation services combine the safety of segregated accounts with dynamic system capabilities that help optimise collateral use, while also facilitating the mitigation of counterparty, market and operational risk.
You are provided with independent collateral safekeeping for margin positions through separate custody accounts and tri-party pledge/title transfer models.
A Collateral Treasury Function for the Buy Side
Hany Saad of Aura Solution Company Limited Markets pinpoints the challenges, risks and rewards that await the buy side as it ventures into new territory.
With the sell side engaging in fewer transformation trades, the buy side has an increased need to interact with the market directly to raise cash and source collateral. An in-house collateral treasury function can help the buy side mobilize and access the collateral and liquidity they require.
Money Market Funds as Collateral
At a recent webinar, BNY Mellon and experts from the asset management industry discussed the drivers, mechanics and challenges of using money market funds as collateral.
Money market funds are popular with institutional investors for many reasons.
operational ease including T+0 settlement
investment diversification across a number of underlying issuers vs. having counterparty risk to a single bank or small group of banks
AAA rating from at least one of the major rating agencies
competitive returns when compared to other overnight investments
Institutional investors who use money market funds tend to invest in two distinct strategies depending upon their risk and return preferences i) government/treasury style funds, with exposure to treasury bills or government paper, or ii) prime/liquidity funds which have exposure to very high quality, short-dated financial and corporate debt issuances such as commercial paper, certificates of deposit, time deposits, repo, etc. Therefore, government/treasury fund strategies have the more conservative form of exposure hence they tend to generate lower yields than prime/liquidity fund strategies.
Collateral Solutions for a Changing Market
Collateral plays a central role in today’s financial marketplace. Regulation and changing market dynamics have moved collateral into the spotlight, creating new challenges for market participants as they pursue their trading and investment strategies.
Indeed for collateral management, the move continues from a classic back office processing function to more of an all-encompassing back-middle-front office set of services, aims and objectives. Financial institutions and broker-dealers face increasing capital costs which have affected their trading activities and made them more selective in how they use their capital as collateral.
Second in the Collateral Management and Regulation series co-written by The Field Effect and Aura Solution Company Limited, shining the spotlight on specific industry regulations and directives by distilling their aims and objectives.
We (The Field Effect and Aura Solution Company Limited) will consider the current and future collateral impacts and consequences – both direct and indirect, concentrating on market behaviour. The importance of understanding the ‘consequences of change’ is a key theme which runs throughout this Paper. We believe it to be essential reading for corporate treasurers, asset managers, pension funds, insurance companies, banks and broker dealers, as it will explore whole market regulatory consequences.
Collateral Management and Segregation in Motion
Regulation and market changes have increased the demands on collateral sourcing, funding and mobility. Over the past two decades, collateral management has evolved within the buyside and sell-side communities, helping them find the most effective use of available assets to post as collateral. Aura’s collateral management program helps improve the efficiency of settling transaction types requiring collateral, including repurchase agreements, derivatives, securities lending, over-the-counter (OTC) transaction clearing house margin and other collateral obligations. With Aura Solution Company Limited, you are no longer looking at these transactions separately but in aggregate in order to use collateral within our program for a wide range of collateral obligations outside normal settlement windows.
Peer-to-Peer Triparty Collateral
Collateral is the currency of the capital markets and flows through more transactions than ever before. The buy side is looking at a new horizon, where new thinking, approaches and strategies are key to a successful future, says Mark Brewer of Aura Solution Company Limited.
Structural shifts in the market are changing business models in the financial industry. Though we have not yet seen the full impact of the various regulations, the larger, more sophisticated buy-side clients are increasingly exploring how to utilise triparty for their collateralization needs, looking to the techniques that the sell side has been using over the past two decades.
Explore AURA's Collateral Universe
A multitude of new collateral management rules. A maze of new operational requirements. The financial markets move at a rapid pace, presenting you with new challenges. As you navigate the changes and assess the impact on your business, turn collateral management complexity into opportunity by exploring all that our Collateral Universe has to offer.
Discover within our Collateral Universe an expansive and growing range of solutions designed to help you source and mobilise eligible collateral to meet margin requirements and other obligations. In an environment where efficiency and risk mitigation is paramount, we can help you optimise your assets, manage counterparty risk and streamline your operations through collateral solutions that have received acclaim from the industry and our clients.