Collateral Management

The use of collateral, for many years associated mainly with repo and securities lending transactions, has seen a rapid growth within the financial marketplace. The need to reduce exposure in these transactions, as well as the rise of the OTC derivatives market, has led to a significant increase in the degree of complication faced by operations departments.

Successful processing of collateral within an organisation requires knowledgeable staff that understand the component parts that lead to safe and secure processing, as well as awareness of the pitfalls that can result in unacceptable exposures.

Candidates who complete the Collateral Management training programme qualify for 13 credit hours under the guidelines of the CFA Institute's Continuing Education Programme.

This course is provided through a partnership between ICE Education and the International Capital Markets Association (ICMA) Executive Education.

Course Information

Price £1,850 + VAT
Duration 2 days
Location London
Available Dates

Who Should Attend

The course is suitable for collateral management personnel who would benefit from understanding the big picture and those who have had limited exposure to collateral but who require a greater understanding of the relationships between their work and collateral and those who have recently been transferred to the collateral management department.

Booking Information

Tel: +44 (0) 20 7065 7706

Course Content

1. Fundamental Collateral Concepts

  • Definition and purpose of collateral
  • Why the increased focus on collateral?
  • Overview of the collateral life-cycle

2. Types of Collateral

  • Cash
  • Bonds
  • Equity
  • Collateral impact on regulatory capital: overview

3. Transaction Types Necessitating Collateral

  • Securities lending and borrowing
  • Repo
  • Secured cash borrowing and lending
  • OTC derivatives
  • Cash borrowing at CSDs and custodians
  • FX
  • Tri-party collateral services

4. Legal Protection

  • Necessity of legal protection
  • Master agreements
  • Definitions
  • Credit support annexes
  • ECB valuation haircuts
  • Confirmations

5. Static Data

  • Concepts of static data
  • Concepts of STP
  • Static data and STP in collateral management

6. The Collateral Life-cycle

  • Pre-trading
  • Trading

Throughout lifetime of trade

  • Trade reconciliation
  • Marking-to-market
  • Collateral call calculation
  • Making and receiving collateral calls
  • Collateral substitution
  • Income and corporate actions
  • Trade termination

7. The Collateral Management Function

  • Overview of responsibilities
  • Centralised collateral function
  • Cost centre vs. profit centre

8. Current Initiatives

  • Clearing of OTC derivatives
  • The regulators™ perspective
  • Regulatory changes: overview
  • Central clearing and collateral management