Liquidity Management

Investments, Liquidity Management

Liquidity, reserve currency, tariffs, topstory, US dollar

The US dollar is the global reserve currency. According to the Fed, there are $1.62 trillion in Federal Reserve notes outstanding, what we consider as cash, much of which is…

How can central banks effectively monitor transmission of monetary policy?

August 8, 2018

Collateral, ECB, Liquidity Management

ECB, Liquidity, monetary policy, topstory

A new paper from the European Central Bank looks at the transmission of monetary policy and the concept of fragmentation, which means that monetary policy goals are not getting through…

Finadium announces H2 2018 event calendar for New York, London and Zurich

July 11, 2018

Collateral, Liquidity Management, Repo, Technology

collateral, Finadium events, Liquidity, Repo, Securities Lending, technology, topstory

Finadium will enter the fall months with a robust slate of events on technology, collateral, repo and securities lending. Here’s our upcoming calendar of events in New York, London and…

Treasury issuances and Fed rates are changing technicals in the short end (Premium)

June 20, 2018

Cash management, Federal Reserve, Fixed Income, Interest rates, Investments, Liquidity Management, Money Market Funds, Repo, Short Term Interest Rate Benchmarks, SOFR, US

Fed Funds, Repo, SOFR, topstory, US, US Treasury

As the US Treasury moves to add even more to short dated securities to fill their deficit hole, while at the same time the Fed raises rates and slowly unwinds…

Finadium: Is Frankfurt the Next Collateral and Liquidity Hub?

May 15, 2018

Asia, Collateral, Collateral Management, Europe, Liquidity Management

Asian banks, collateral, Finadium, Frankfurt, Liquidity, topstory

A new Finadium research report looks at Frankfurt as a financial center and some key aspects that may determine its competitiveness and future relevance post-Brexit and beyond. Does it have…

Can Fixed Income ETF liquidity hold up against underlying liquidity changes? Panel respondents say yes

April 26, 2018

Anna Reitman

ETFs, Fixed Income, Liquidity Management

ETFs, Fixed Income, Liquidity, topstory

The Fixed Income ETF marketplace is undergoing scrutiny as liquidity gravitates to these products and away from the underlying. The fact is, ETFs are easier to trade than individual fixed…

Fed’s Randal Quarles outlines face of banking regulation to come while the Fed issues a new SLR proposal

April 12, 2018

Basel III, Dodd-Frank, Featured, Federal Reserve, Liquidity Management, Regulatory, Systemic Risk, Uncategorized

Federal Reserve, Leverage Ratio Volcker Rule, Randal Quarles, TLAC, topstory

Randal Quarles, Vice Chairman for Supervision at the Federal Reserve spoke last month at the American Bar Association Banking Law Annual Meeting. The speech, “Early Observations on Improving the Effectiveness of…

The Basel Committee works to figure out sovereign risk on bank balance sheets

December 20, 2017

Basel III, Liquidity Management, Risk Management

Basel Committee, sovereign risk, topstory

Sovereign risk has proven to be a double edged sword. How much risk is there really, and should sovereign debt be included at face value in the Leverage Ratio? Or…

We’re not much worried about US tax reform’s impact on repo, but non-tri-party, non-DvP repo participants should stay alert

December 19, 2017

Liquidity Management, Regulatory, Repo, Tax, US

DTCC, DvP, Liquidity, Repo, SOFR, topstory, US tax reform

As everyone connected to the Internet or paper media knows, the US is close to passing a massive tax reform package that offers some of the most substantial changes since…

Our analysis of IOSCO’s latest hedge fund survey (Premium)

November 27, 2017

Hedge Funds, IOSCO, Liquidity Management

hedge funds, IOSCO, Leverage, topstory

IOSCO released their 2016 data analysis of hedge fund assets, leverage and liquidity. While this document always feels a bit dated compared to current markets, it also has some kernels…

CM2025: the physical market rebounds

It’s the year 2025. Following the passage of Dodd-Frank and related Basel III capital rules, banks did what they were supposed to do: they reduced Shadow Banking risk by cutting…

Interfund lending: are repos the right way to get this done?

November 20, 2017

Liquidity Management, Repo

Barron's, interfund lending, Liquidity, Repo, sec, topstory

An article in the November 11, 2017 Barron’s discussed the idea of interfund lending. In “When Funds Lend to One Another,” the author notes that “interfund lending by fund companies…

Finadium: European Prime Brokerage Survey: Customers, Capital and Business Models

November 15, 2017

Basel III, Liquidity Management, Prime Brokerage

Europe, Finadium, Prime Brokerage, topstory

This Finadium research report is a survey of European prime brokers’ thinking towards capital and clients. We investigate how much prime brokers are aware of their balance sheet requirements and…

Why you should care about off-the-run US Treasury trading platforms

November 15, 2017

Audit, Collateral Management, Fixed Income, Liquidity Management, US

Liquidity, LiquidityEdge, off-the-runs, OpenDoor, topstory, US Treasuries

Two press releases last week highlight the importance of liquidity in off-the-run US Treasuries. As the battle of the platforms is heating up, the winners will be holders of off-the-runs…

Are carve-outs in national versions of the Leverage Ratio a good idea?

November 8, 2017

Basel III, Liquidity Management, Regulatory

carve-outs, Leverage Ratio, SLR, topstory

There has been discussion in recent months about the possibility of large carve-outs in the US Supplementary Leverage Ratio; this follows years of carve-outs in the European version of Basel…

Debating solutions to the US Supplementary Leverage Ratio problem (Premium)

November 1, 2017

Basel III, Derivatives, Liquidity Management, US

SLR, Supplementary Leverage Ratio, topstory, US, US Treasury

The US Supplementary Leverage Ratio (SLR) isn’t working very well, that much we know. As a non-risk based measurement of risk, it captures every asset with the same risk weighting…

An activities-based approach to regulation from the US Treasury report on asset managers and insurance companies (Premium)

October 31, 2017

Derivatives, Dodd-Frank, Investments, Liquidity Management, Regulatory, SEC, US

asset managers, derivatives, Dodd-Frank, insurance companies, Liquidity, topstory, US Treasury

The US Treasury has released its third major report on core principles for financial markets. The first two covered capital markets and banks; the latest is on asset managers and…

Our slides from the Oct 3 London event, “Market Competition, Europe and US regulations” (Premium)

October 4, 2017

Bank of England, Bank of Japan, Basel III, Europe, Liquidity Management, Regulatory, Repo, Risk Management, Securities Lending, US

Europe, Finadium, London, Regulation, tapering, topstory, US

Thanks to our clients who attended our event in London this week on market regulations and their impact on competition between the US and Europe. Our slides are available for…

Credit Suisse’s Zoltan Pozsar on sterilization, repo and FX Swaps (Premium)

September 25, 2017

Cash management, Collateral Management, Federal Reserve, FX, Liquidity Management, Repo

Credit Suisse, FX Swaps, Liquidity, Repo, sterilization, topstory, Zoltan Pozsar

Credit Suisse’s Zoltan Pozsar has written a master class on how money flows in today’s financial markets. It’s on the complicated side and you might need to read this article…

Finadium: Can ETFs Replace Cash Accounts?

September 20, 2017

Cash management, ETFs, Investments, Liquidity Management, US

cash management, ETFs, Liquidity Management, topstory, ultra short

A new research report from Finadium looks at the range of ultra short ETFs, some of which are competing with traditional cash accounts for investor interest. This report should be…

Finadium: Central Bank Tapering: Impacts for Liquidity and Collateral Markets

September 12, 2017

Bank of England, Bank of Japan, Collateral Management, ECB, Federal Reserve, Investments, Liquidity Management

Bank of England, Bank of Japan, Central Banks, European Central Bank, Federal Reserve, Finadium, tapering, topstory

Central bank tapering season is on the horizon: this means opportunities for price volatility, spread movements between products, and exchange rate fluctuations. It also means a potentially new set of…

The SEC report on liquidity and regulations: its a complex story, not a done deal

August 15, 2017

Investments, Liquidity Management, Regulatory, SEC, US

Liquidity, sec, topstory, US Treasuries, Volcker Rule

The headlines say that the SEC reports little damage to liquidity from regulations, and this is going to influence both government and public opinion going forward. But the SEC measured…

What’s the real risk of CCPs, counterparty risk or liquidity risk?

August 7, 2017

CCP, Liquidity Management, Risk Management

CCP, default risk, liquidity risk, Margin, risk waterfall, topstory

A recently issued academic paper from Dr. Rama Cont at Imperial College London makes the argument that CCPs don’t mitigate counterparty credit risk, they just transform it into liquidity risk.…

TLAC bond requirements get tougher – will investors still want them?

August 1, 2017

Basel III, Corporate Bonds, Europe, Liquidity Management, Regulatory, Risk Management, Systemic Risk, unsecured funding

Bonds, Funding/Liquidity, regulatory capital, TLAC, topstory

Total Loss Absorbing Capital (TLAC) is a core element of the Basel regulatory capital regime, which sets minimum liquidity reserve standards for banks. Banks are now issuing qualifying debt instruments…

Get ahead on key issues with Finadium research: an example from the BIS Annual Report

July 12, 2017

Bank for International Settlements, Funding/Liquidity, systemic risk, topstory

Cash management, Collateral Management, ECB, Europe, Liquidity Management, Market infrastructure, Money Market Funds, Pro-cyclicality, Regulatory, Repo, Risk Management, Systemic Risk

The Bank for International Settlements (BIS) released their 87th annual report on June 25th including an important section on risks in the US dollar funding market. The section outlines concerns…

Are the buy side and sell side on the same page about the direction of prime brokerage?

July 3, 2017

Hedge Funds, Investments, Liquidity Management, Prime Brokerage, US

BNY Mellon, buy-side, Finadium, financing, hedge funds, Liquidity, Prime Brokerage, topstory

BNY Mellon released the results of a buy-side survey on liquidity and financing on June 26th. How closely do the concerns and attitudes of investors towards their liquidity and financing…

Finadium: Scenarios for the Next Collateral Crisis – download a free excerpt

May 4, 2017

Central Counterparties, Collateral Management, Derivatives, Investments, Liquidity Management, Market infrastructure, Regulatory, Repo, Technology

CCPs, Central Banks, collateral management, dealers, Regulatory, Repo, technology, topstory

A new research report from Finadium looks at scenarios for a full-blown collateral crisis that could arise over the next two years. These scenarios are all based on real-world situations…

How much should government be involved in the securities financing markets? (Premium)

April 26, 2017

Basel III, Liquidity Management, Regulatory, Repo, Securities Lending

BIS, government, Liquidity, market failure, Regulation, Repo, securities finance, Securities Lending, topstory

Pick one: governments, in particular Central Banks, should be A) heavily and permanently involved in financing; B) only be involved in an emergency; or C) never be involved. Regulators seem…

Under bank capital rules a reduction in US Federal deficit would spell serious trouble

October 17, 2016

Collateral Management, Dodd-Frank, Federal Reserve, Liquidity Management, Market infrastructure, Money Market Funds, Regulatory, Repo, Systemic Risk, US

Federal deficit, Federal Reserve, Liquidity, systemic risk, topstory, US Treasuries

The US Federal deficit has been an absent topic in recent Presidential debates and skirmishes. Certainly it is less enticing to the general populace than the latest scandals and accusations.…

The collateral consequences of Brexit (Premium)

June 24, 2016

Collateral Management, Europe, Liquidity Management, Regulatory

bank capital, Brexit, collateral, ratings, topstory

The UK’s historic vote to leave the European Union has sent shock waves throughout financial markets. On Friday, the pound started the day down 9%, share prices were down 16%…

An interview with Bimal Kadikar, CEO of Transcend Street Solutions

May 16, 2016

Big Data, Collateral Management, Derivatives, Liquidity Management, Operations, Technology

Big Data, Bimal Kadikar, collateral management, Liquidity, Margin, technology, topstory, Transcend Street

Transcend Street Solutions is establishing itself as an innovative player in the collateral and liquidity technology space. We spoke with CEO and founder Bimal Kadikar to learn more about what…

NY Fed President Dudley on market and funding liquidity; recognizes potential liquidity decline (Premium)

May 3, 2016

Federal Reserve, Liquidity Management, US

Dudley, Federal Reserve Bank of New York, Liquidity, topstory

This is really interesting: New York Fed President William Dudley gave a speech over the weekend on market and funding liquidity at an Atlanta Fed conference. After defending market liquidity…

Federal Reserve on fixed income liquidity (disappointing) and blockchain in clearing and settlement (downright positive) (Premium)

April 20, 2016

Blockchain, Federal Reserve, Fixed Income, Liquidity Management, Regulatory, Technology

blockchain, Brainard, Federal Reserve, Fixed Income, Liquidity, Powell, topstory

A major speech and congressional testimony were released by the Federal Reserve on two important topics for Securities Finance Monitor readers: fixed income liquidity and blockchain for clearing and settlement.…

What would blockchain mean for "cash" and "credit" in funding? (Premium)

March 8, 2016

Bitcoin, Blockchain, Cash management, CCP, Central Counterparties, Collateral Management, Credit Exposure, Liquidity Management, Risk Management, Securities Lending, Technology

blockchain, cash management, Credit Exposure, credit intermediation, Settlements, topstory

Big Data, Collateral Management, Liquidity Management

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Collateral and Liquidity Data Management: the next big challenge for financial institutions

March 7, 2016

Bimal Kadikar

Big Data, Bimal Kadikar, collateral, Liquidity, topstory, Transcend Street

The problem is well known: financial institutions have data all over the place. Small institutions tend to face straight-forward challenges, while large ones must identify not only where data are…

Blockchain and settlements: are there real savings or is this hype? (Premium)

February 24, 2016

Blockchain, Liquidity Management, Market infrastructure, Operations, Regulatory, Settlements, Technology

Basel III, blockchain, Settlements, topstory

Collateral Management, Liquidity Management, Securities Lending

There has been a LOT of noise about blockchain and settlements in the last week – the decibel level is approaching 10 on the hype-o-meter. This article reviews commentary and…

Resilience and opportunity in the securities lending market

February 24, 2016

Ross Bowman

agency securities lending, BNP Paribas, BNPP, Securities Lending, topstory

Interest rates across Europe are widely expected to stay low for the foreseeable future, with even the possibility of further easing on the horizon, as the ECB asset purchase programmes…

Monday news update: Central Banks on liquidity; the Lender of Last Resort; CSD-R

February 15, 2016

Bank of England, Europe, Federal Reserve, Liquidity Management, Regulatory

Bank of England, Bloomberg, CSD-R, ECB, Federal Reserve, Liquidity, LOLR, topstory

This edition of our news update focuses on a new articles series on liquidity from the Federal Reserve and a conference on the Lender of Last Resort held last week.…

Regulators, please adjust the rules to preference the underlying markets, not the derivatives markets

January 27, 2016

Bank of England, Basel III, Derivatives, Fixed Income, Liquidity Management, Regulatory, Repo, Securities Lending

derivatives, Liquidity, securities finance, topstory, volatility

collateral modelling, complexity, high performance computing, non-cash collateral, topstory

There is a fundamental liquidity problem in financial markets with a conceptually easy fix. The problem is that regulators have accidentally preferenced the use of derivatives over physical financing transactions…

2016 collateral tech trends: a view from the buy side (Premium)

January 21, 2016

Anna Reitman

Blockchain, Collateral Management, Derivatives, Liquidity Management, Technology

Buy-side innovation in collateral management continues to be driven by firms’ needs to align with the business, control costs and provide transparency. In an interview with Securities Finance Monitor, Grigorios…

The Big Short: ancient history or modern warning on derivatives?

January 12, 2016

Derivatives, Featured, Liquidity Management, Regulatory

derivatives, Liquidity, Regulation, The Big Short, topstory

The movie The Big Short, based on Michael Lewis’s book of the same name, tells the story of three early short sellers of the US housing market running up to…

Finadium announces 2016 annual conference date, releases agenda

January 6, 2016

Blockchain, Central Counterparties, Collateral Management, Delta One, Derivatives, Investments, Liquidity Management, Market infrastructure, Prime Brokerage, Regulatory, Repo, Securities Lending, Technology

conference 2016, Finadium, topstory

Finadium’s 10th annual conference will be held on March 15, 2016 in New York City. This program features leading participants in the securities finance and collateral management markets and is…

Should we be worried about equity ETFs as the next big potential crisis? (Premium)

January 4, 2016

Derivatives, Liquidity Management

ETFs, Liquidity, topstory

collateral management, collateral management systems, collateral management technology, Collateral Optimisation, topstory

The press has been abuzz about potential systemic risk concerns stemming from ETFs of all sorts, and this crept into our holiday conversations as well. The events of August 24,…

4Sight Collateral Management: Benchmarking Your Systems and Processes

November 19, 2015

Martin Seagroatt

Collateral Management, Derivatives, Liquidity Management, Technology

Collateral management is changing rapidly to meet the demands of the new post-crisis environment. It can be difficult for firms to know where to start when defining a target operating…

Extending the 48 hour collateral liquidation stay to financing trades: cash lenders won’t be happy

November 12, 2015

Basel III, Liquidity Management

Collateral Management, Credit Exposure, Featured, Liquidity Management, Money Market Funds, Repo, Risk Management

collateral liquidation, FDIC, FSB, OLA, safe harbor, topstory

ICMA, FSB, ISDA and Bloomberg are talking about the extension of the 48 hour rule in derivatives – where if a counterparty goes bust, liquidating the collateral is subject to…

Mind the gap: building evergreen style portfolios throughout the operational value chain

November 4, 2015

Tobias Duchscherer

evergreen, HQLA, LCR, topstory

Evergreen financing structures are gaining popularity as a way to manage the complexity of Liquidity Coverage Ratio (LCR) funding requirements. However, most trading and post-trade systems are not set up…

Derivatives, Securities Financing and the Law of Conservation: Transforming Counterparty Risk into Liquidity Risk

November 3, 2015

Basel III, CCP, Central Counterparties, Cleared Interest Rate Swaps, Credit Exposure, Derivatives, Dodd-Frank, Featured, Liquidity Management, Regulatory, Repo, Risk Management

Law of Conservation, Physics, topstory

A former physicist, now Wall Street risk and regulation quant, said at a recent conference that when thinking about regulation, he is reminded of the Law of Conservation. That is…

Should we stop talking about collateral optimization now in favor of something bigger? (Premium Content)

October 7, 2015

Collateral Optimisation, collateral optimization, Collateral Transfer Pricing, fund transfer pricing, topstory, yield enhancements

Big Data, Blockchain, Collateral Management, Credit Exposure, Featured, Liquidity Management, Market infrastructure, Operations, Technology

We’ve had several discussions over the last two weeks about collateral optimization and its role in the market. One result of these conversations is that maybe collateral optimization is largely…

The FSB takes on fund leverage and liquidity

September 29, 2015

Featured, Financial Stability Board, Fixed Income, Investments, Liquidity Management, Risk Management, SEC, Securities Lending, Shadow Banking

Financial Stability Board, FSB, fund management, Leverage, Liquidity, Securities Lending, Shadow Banking, topstory