OSTTRA’s TriOptima Launches Credit Optimisation


OSTTRA’s TriOptima, a leading infrastructure service that lowers costs and mitigates risk in OTC derivatives markets, announced a new triBalance credit optimisation rebalancing initiative that reduces risk in multiple central counterparties (CCPs), including LCH CDSClear and ICE Clear concurrently.

This new service, which has already allowed 12 participants to eliminate more than $475bn of gross notional value from cleared Index Credit Default Swaps (CDS), enables investment banks such as Goldman Sachs and J.P. Morgan to simultaneously optimise multiple risk measures including notional, initial margin (IM) and capital exposures on a multilateral basis. Previously, banks would have had to reach out to, and negotiate with, counterparties individually to mitigate the same type of risk. The addition of credit to TriOptima’s multilateral network uniquely positions the service to optimise across all derivative asset classes, FX, rates, commodities, equities and credit derivatives.

“We appreciate triBalance for establishing a framework to optimise notional and capital for cleared credit products and look forward to future offerings targeting capital & IM reduction in the credit and mortgages space in the future,” said Kaushik Murali, Global Head of Index Trading at Goldman Sachs.

“Rebalancing credit risks across ICE Clear and LCH CDSClear is an important risk-management task and solutions to support dealers to achieve this will reduce market fragmentation and help deliver results for clients. Through a successful first session TriOptima: triBalance Credit has helped us to reduce initial margin and simplify positions, enabling us to continue delivering a best-in-class service”, said Aymeric Paillat, Head of J.P. Morgan Global Credit Index Trading.

“We welcome initiatives like triBalance Credit that help our members manage their gross notional and derived capital exposure across CCPs.” added Frank Soussan, Global Head of CDSClear, LCH.

“The risk reductions achieved, demonstrate the value that this triBalance Credit initiative is already delivering for our clients. It enables financial institutions to achieve further capital efficiencies and reduce funding costs associated with margin requirements, while contributing to the smooth and efficient running of the credit derivatives market,” concluded Erik Petri, Head of triBalance at TriOptima.

Source: OSTTRA

Related articles

  1. With Dmitry Kay, Co-head of EM FX Trading, Europe, UBS

  2. It is the first liquidity-seeking algorithm on Atlas, the equities trading platform introduced in 2019.

  3. Morgan Stanley completed the acquisition of E*TRADE in 2020.

  4. Machines 'Learn' Front Office

    The platform provides a quick way to create and share trusted data through machine learning and automation.

  5. The Federal Reserve said the pilot exercise will be launched in early 2023.