Fintech weekly deals and partnerships round-up

ABN AMRO, ING, OCBC and Macquarie among banks launching digital blockchain platform

Together with top commodity industry players and financial institutions, ABN AMRO is exploring the options to launch Forcefield, a digital blockchain platform that can provide real-time insight into trade inventories. Besides ABN AMRO, Accenture, Anglo American, CMST International, Hartree Partners, ING Bank, Macquarie, Mercuria and OCBC Bank are among the parties that have so far signed up to the Memorandum of Understanding (MOU) to launch Forcefield.

Forcefield has been funded and developed for the past 12 months as a stand-alone product moving through the successful proof of concept phase with Accenture as the technology provider. Following several cycles of development, Forcefield formed as an independent company to finalize the platform deployment and operate as a market utility. The system will initially focus on refined metals, but functionality will be expanded across other dry bulk commodities. Forcefield will be open and inclusive to all market participants in order to drive mass adoption.

The platform can communicate with physical trade inventories through the Internet of Things, sensors and Near Field Communication chips. As a result, the inventories, which are often collateral for loans, can be monitored very effectively, which will lead to more secure physical handling processes and a reduction of costs.

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Bain Capital Credit goes live with Hazeltree collateral manager

Hazeltree and Bain Capital Credit ($41bn AuM) announced the successful implementation of Hazeltree Collateral Manager to streamline collateral management across ISDA counterparties. A major driver for Bain Capital Credit’s evaluation and selection of Hazeltree Collateral Manager is the upcoming Uncleared Margin (UMR) and Standard Initial Margin Model (SIMM) that are coming sharply into focus for end-users on non-centrally cleared derivatives.

Hazeltree Collateral Manager enables Bain Capital Credit to: streamline, aggregate and centralize its OTC collateral management activities; compare and reconcile internal, independently-calculated OTC collateral call estimates against each counterparty’s calls; and, seamlessly respond to, issue, or dispute daily margin calls via all eligible cash and non-cash assets.

“Moving our collateral management off spreadsheets and to Hazeltree’s cloud solution helps us automate responding to calls, focus on collateral exceptions and, generally, streamline the interactions with our ISDA counterparties,” said Tom D’Orsi, head of Treasury in the Capital Markets unit at Bain Capital.

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LCH’s RepoClear picks UnaVista as SFTR trade repository

UnaVista announced it’s been selected by LCH’s RepoClear as their trade repository to meet their reporting obligations under the Securities Financing Transaction Regulation (SFTR). LCH Group’s Collateral and Liquidity Management function will also be using UnaVista for its SFTR reporting.

SFTR is scheduled to go live in April next year and will require firms to report details of their Securities Financing Transactions (SFTs) to an approved trade repository. Known as the ‘MiFID II for repo’, the regulation is designed to increase transparency, allowing regulatory authorities to assess the risks associated with these transactions.

The agreement with LCH in respect of RepoClear, will enable UnaVista to offer a form of collaborative reporting called assisted reporting to LCH’s RepoClear members. RepoClear members will have the option to allow UnaVista to flip aspects of LCH’s transaction and margin reporting to create a report from the member’s perspective. This function will offer significant operational efficiencies and supports accurate transaction matching.

Bruce Kellaway, global head of RepoClear and Collateral and head of EquityClear, said in a statement that RepoClear’s members are now presented the additional option of assisted reporting to handle and simplify their SFTR requirements for those trades they clear through LCH. And reference data is expected to help firms enrich their reports, flexible collaborative reporting models will help firms with counterparties to report, and extensive reconciliation and analytics will ensure firms improve their reporting with time.

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OpenFin raises $17mn from Wells Fargo and Barclays

OpenFin, the operating system (OS) of finance, has raised $17 million in Series C funding from major banks and leading fintech investors. The funding round was led by Wells Fargo with participation from Barclays and existing investors including Bain Capital Ventures, J.P. Morgan and Pivot Investment Partners. The Series C round brings OpenFin’s total amount of venture funding to $40 million.

Proceeds from the financing will be used to make OpenFin OS ubiquitous on financial desktops and to fund further product innovation. This includes OpenFin’s new cloud services offering, which enables banks, asset managers, wealth managers and hedge funds to provide their own private app stores for employees and customers out of the box.

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Reuters: dozen banks to invest $50 million for digital cash settlement project

Several of the world’s largest banks are in the process of investing around $50 million to create a digital cash system using blockchain technology to settle financial transactions, according to people familiar with the plans. The previously disclosed project, known as the “utility settlement coin,” was first proposed by UBS and London-based technology startup Clearmatics in 2015. It aims to develop a system to make clearing and settlement in financial markets more efficient.

Around a dozen banks are investing in a new entity called Fnality which would run the project, one of the people said. The deal has not been finalized so details may change. The new system could launch in 2020, the person said. It is unclear which banks are participating in the investment round. Banks that had previously disclosed they were working on earlier phases of the project include UBS, Banco Santander, BNY Mellon, State Street, Credit Suisse, Barclays, HSBC and Deutsche Bank.

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World Bank and CBA team up for secondary bond trading on blockchain

The International Bank for Reconstruction and Development (World Bank) and Commonwealth Bank of Australia (CBA) have enabled secondary market trading recorded on blockchain for bond-i (blockchain operated new debt instrument), making this the first bond whose issuance and trading are recorded using distributed ledger technologies.

The successful completion of a secondary transaction with trading activity recorded on a distributed ledger illustrates the vast potential to enhance the co-ordination of securities trading and management on blockchain – deDlivering a verified, permanent record and instant reconciliation. The functionality was developed by CBA in conjunction with World Bank and market maker TD Securities.

“Enabling secondary trading recorded on the blockchain is a tremendous step forward towards enabling capital markets to leverage distributed ledger technologies for faster, more efficient, and more secure transactions,” said World Bank VP and treasurer Jingdong Hua, in a statement.

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South Africa bourse launches clearing platform from Nasdaq

The Johannesburg Stock Exchange (JSE) successfully went live with a new real-time clearing platform for the JSE’s Equity Derivatives and Currency Derivatives market. The launch is part of a multi-year project known as ITaC focusing on migrating all the JSE’s markets to the new clearing solution, bringing a host of benefits to the market including more efficient collateral utilization, intra-day risk monitoring and improved margin transparency. The project is delivered in phases with the first asset classes to be migrated being Equity and Currency Derivative markets.

“The launch of our new clearing platform is an important milestone in our aim to align ourselves with global best practices using a state of the art, multi-product technology solution,” said JSE CEO, Nicky Newton-King, in a statement. “Technology has become vital for clearinghouses in offering services that stand up to market participants’ and regulators’ demands on robust risk management, transparency and efficiency.”

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