IHS Markit, AcadiaSoft Partner on Margin Automation
Business information provider IHS Markit announced an alliance with AcadiaSoft, a provider of margin automation solutions, to connect the firms’ industry leading platforms for managing initial margin. The alliance will help the non-cleared derivatives community comply with margin regulation, as potentially over 1,000 firms are brought into scope in phase four (September 2019) and phase five (September 2020).
In connecting their platforms, the integration will help shared customers achieve straight-through processing for the entire margin lifecycle, which includes negotiating margin terms, calculating initial margin for each trade and valuing and exchanging collateral daily.
Two-way data exchange between IHS Markit and AcadiaSoft will unite the expertise of both firms and automate how technology platforms supporting the margin process source data from one another. Key contractual terms from margin and custodial agreements generated by IHS Markit will be transmitted to AcadiaSoft’s Agreement Manager, and risk sensitivities calculated by IHS Markit will power the Initial Margin Exposure Manager, part of the AcadiaSoft Hub. In turn, margin reconciliation data from AcadiaSoft will be channeled to users of the initial margin calculation and collateral management services from IHS Markit.
“The regulatory requirements for initial margin are complex and to meet fast approaching compliance deadlines, phase four and five firms need to have the right technology in place as soon as possible,” said Nosheen Amir-Ebrahimi, managing director and product head, Derivatives Data and Valuation Services at IHS Markit. “Creating seamless connections with AcadiaSoft is part of how we are helping in-scope firms reduce the cost of compliance and technology.”
“A cornerstone of AcadiaSoft’s strategy is the ability to integrate with key vendors to provide effective straight-through solutions that are simple to adopt,” said Chris Walsh, CEO of AcadiaSoft. “Our alliance with IHS Markit further demonstrates our commitment to our clients as we continually adapt to help them navigate today’s regulatory environment.”
“The integration of Margin Xchange™ from IHS Markit to automate and structure complex margin and custodial legal agreements and store contract data with AcadiaSoft brings together all the necessary components for straight-through processing across the margin lifecycle,” said Darren Thomas, managing director, Regulatory and Compliance at IHS Markit. “Customers will be able to manage the margin cycle holistically end-to-end from agreement creation to margin calculation and settlement with greater ease and efficiency.”
Source: IHS Markit
Phase 5 of the uncleared margin rules came into effect on 1 September.
Triparty repos can be executed across U.S. Treasury securities to central clearing.
Traders on EQONEX will be able to use US dollars, USD Coin and Bitcoin as margin for derivatives trading.
DTCC’s Margin Transit Utility simplifies the transfer of collateral.
Smaller entities come into scope in phase five of the uncleared margin regulations on September 1.