AcadiaSoft Inc., the leading industry provider of risk and collateral management services for the non-cleared derivatives community, today announced a new initiative with BNY Mellon that will allow buy-side market participants to manage margin calls, calculations, reconciliations and instruct the movement of collateral through a single interface.
The firms previously announced a joint offering around outsourced initial margin calculations. This iteration adds significant new functionality that will enable buy-side clients to concentrate their entire collateral lifecycle through their relationship with BNY Mellon and AcadiaSoft, rather than being forced to split different activities among multiple service providers.
The AcadiaSoft-BNY Mellon offering will also make compliance with the final two implementation phases of the non-cleared margin rules substantially simpler as buy-side firms come into scope in 2020 and 2021.
"We're thrilled to deepen our partnership with BNY Mellon, which is one of the market leaders in collateral management, and we look forward to expanding the connectivity to support collateral segregation of other products," said Chris Walsh, CEO of AcadiaSoft.
Buy-side entities have traditionally had to contend with bifurcated elements in the collateral management workflow. These have included segregating collateral with a custodian, calculating margin and issuing margin calls themselves or relying on a central service such as AcadiaSoft, and using reconciliation services to resolve margin disputes.
Due to the scarcity of SWIFT messaging capabilities among the buy-side, at the end of a transaction market participants have traditionally had to resort to faxing or accessing dedicated portals to instruct their trade counterparty to deliver the required collateral into their segregated account.
AcadiaSoft and BNY Mellon have streamlined all of these activities into a single seamless workflow. Through its connection to AcadiaSoft, clients that select BNY Mellon as their segregation agent will be able to calculate required initial margin, issue margin calls, reconcile disputes and direct the movement and receipt of collateral to the counterparties' relevant custodians all in one place, enabling clients to achieve significantly improved operational efficiency and potentially realize meaningful cost savings.
"This consolidated solution streamlines the entire collateral workflow for clients at a time when the buy-side is facing major new margin requirements on bilateral derivatives trades," said Jonathan Spirgel, Head of Liquidity and Segregation Services at BNY Mellon. "Adding the ability to instruct collateral movements with AcadiaSoft enables clients to take full advantage of our wide range of collateral service offerings in a fully integrated environment."
AcadiaSoft acts as a central repository for calculating IM, enabling market participants to leverage the AcadiaPlus platform - an "open" application providing messaging, data, workflow standards and connectivity to third-party partners for the global collateral industry - as a single point of contact.
BNY Mellon provides comprehensive collateral management for clients, including a range of segregation options, collateral administration, collateral transformation and other services.