A United States Tier-1 Bank has successfully implemented the Smart Collateral (formerly Algorithmics/IBM Collateral) OnDemand solution from Smartstream. This comprehensive solution offers extensive coverage for cleared and non-cleared, over-the-counter (OTC) derivatives, repo, and securities lending margining. The implementation of this cloud-based solution aims to streamline the back-office workflow, significantly enhancing efficiencies within their collateral management operations. By leveraging the Smart Collateral OnDemand solution, the bank has positioned itself to better manage the complexities of collateral management, ensuring greater efficiency, reduced risk, and cost savings.
Challenges
The bank faced the challenge of optimising their back-office operations to handle a growing volume and complexity of collateral management tasks. The existing system required improvement in data capture, validation, calculation, and processing. Moreover, the integration of various reporting solutions and downstream systems needed to be more seamless. The bank also aimed to reduce operational costs while enhancing decision-making capabilities through better trend analysis tools.
Solution
To address these challenges, the bank opted for the Smart Collateral OnDemand solution. This cloud-based offering not only streamlines the entire collateral management process but also integrates robust API links to various reporting and downstream systems. The solution features a powerful user interface that provides clear and logical paths for users, complemented by a management dashboard that aids in trend analysis and decision-making. Additionally, the cloud deployment option of Smart Collateral eliminates the need for on-premise hardware, reducing implementation times and overhead costs.
Implementation
The implementation of Smart Collateral was carried out smoothly, leveraging the cloud deployment option to ensure a quick and efficient setup. This approach removed the necessity for the bank to invest in and maintain their own hardware infrastructure, thereby shortening the implementation timeline. The cloud-based solution also ensured that client data was physically segregated, maintaining the highest standards of data security and compliance.
Benefits
The benefits realised through the adoption of Smart Collateral OnDemand are multifaceted. The solution has significantly improved the efficiency and automation of their collateral management operations, reducing both operational and credit risks. Additionally, the cloud-based approach has led to substantial reductions in internal infrastructure and support costs. The integrated API links and user-friendly interface have streamlined data capture, validation, and processing, while the management dashboard provides valuable insights for trend analysis and strategic decision-making.
Swap Operations Director
“Moving to the cloud enabled us to further improve and automate our operational and credit risk strategies and reduce our internal infrastructure and support costs.”
