Charles River Development, a State Street Company, and AcadiaSoft have announced a business alliance to automate communication of margin calls and collateral estimates between counterparties in the Charles River Investment Management Solution (Charles River IMS) for OTC and exchange-traded derivatives.
EMIR, Dodd-Frank, OSFO-BSIF, and other regulations based on the Basel/IOSCO policy framework have increased collateral and margin requirements for non-centrally cleared derivatives. This has also led to a significant increase in margin call volumes.
AcadiaSoft’s MarginSphere, part of the AcadiaSoft Hub, helps streamline and automate the margin process within Charles River IMS, connecting market participants and service providers to simplify workflows for all parties engaged in collateral management – buy and sell side firms, fund administrators, and clearing firms.
Expanded collateral management capabilities help portfolio managers and traders obtain real time pre-trade margin estimates for exchange traded futures, options on futures, cleared credit and rates as well as un-cleared OTC derivatives. For middle office teams, Charles River automates the collateral life cycle, providing accurate counterparty contract data and a central workbench to manage all margin call workflows.
“Manual processing is error-prone, costly and is too unwieldy and risky to support current and emerging regulations,” says Scott Fitzpatrick (pictured), Director Collateral Business and Client Operations of AcadiaSoft. “MarginSphere provides a central margin service for the industry that replaces email and other manual, proprietary practices with an automated, standard and verifiable electronic process for all parties.”
“Our partnerships with leading providers of collateral management services help our clients keep pace with new regulations governing OTC derivatives,” says John Plansky, CEO, Charles River. “With derivatives seeing increased use by institutional portfolio managers, the alliance with AcadiaSoft helps our clients seamlessly support the full lifecycle of these instruments.”
Charles River was acquired by State Street Corporation in October 2018 and the combined companies are developing the industry’s first ever global front-to-back investment servicing platform. This platform, supported by deep enterprise data management capabilities, will enable investment workflows, provide advanced data aggregation, analytics and compliance tools, and connect and exchange data with other industry platforms and providers. Today’s announcement with AcadiaSoft demonstrates the traction the platform is receiving from key clients and partners who want to access the enhanced trading functionality and services as well as deeper pools of liquidity.