Triparty collateral management services (TCMS) provided by triparty agents (TPAs) allow counterparties to optimise the use of their portfolios of securities when collateralising credit and other exposures across different products and instruments (repo, securities lending, central bank credit, secured loans, and exposures arising from OTC transactions). As part of their daily operations, TPAs provide services such as collateral (auto)selection, valuation and substitution, optimisation of the composition of the triparty pool (allocation cycles) and corporate actions processing. A TPA providing TCMS acts on behalf of the collateral giver and collateral taker.
In December 2011, the Eurosystem decided to support the cross-border use of TCMS – in addition to their domestic use – in the context of Eurosystem credit operations. Subsequently, the Eurosystem defined the features of generic models for crossborder TCMS to be offered by (international) central securities depositories (ICSDs) acting as TPAs in the context of Eurosystem credit operations. The correspondent central banking model (CCBM) provides a basis for the cross-border use of TCMS. Thus, the national central bank (NCB) of a market where TCMS are being offered on a cross-border basis acts as a correspondent central bank (CCB) for central banks in other countries with local counterparties wishing to take advantage of such services on a cross-border basis. TPAs provide the following services on behalf of the Eurosystem: checking/verifying the eligibility of assets against the list of eligible assets published by the ECB on its website on a daily basis; carrying out the daily asset valuation process (based on information sent by the relevant NCB to the TPA); checking the eligibility of the mobilisation channels; carrying out close link checks (when necessary); and processing payments related to corporate actions.
Triparty agents provide the following services on behalf of the Eurosystem: checking/verifying the eligibility of assets against the list of eligible assets published by the ECB on its website on a daily basis; carrying out the daily asset valuation process (based on information sent by the relevant NCB to the TPA); checking the eligibility of the mobilisation channels; carrying out close link checks (when necessary); and processing payments related to corporate actions.