New collateral management service for UK pension scheme
BNY Mellon, a global leader in asset management and securities servicing, has been selected to provide derivatives collateral management services via its DM Edge platform to the Invensys Pension Scheme (IPS). DM Edge facilitates for clients the administrative, processing, reinvestment and valuation activities associated with posting and receiving collateral for over-the-counter derivative transactions.
BNY Mellon and IPS also announced that they have joined forces to develop a ground-breaking single collateral management platform whereby all of IPS’s aggregate collateral requirements across asset managers and bank counterparts will be managed by BNY Mellon.
Robin Claessens, chief executive officer at the Invensys Pension Plan, said: "IPS was seeking a robust and experienced partner to build a unique collateral management platform that is critical for a pension scheme’s overall risk management framework. This framework improves counterparty risk management, allows for a more efficient use of the Scheme’s collateral base, allows the scheme to benefit from economies of scale , and facilitates a more efficient use of certain securities’ liquidity through potential REPO/Stock Loan programmes. Having worked with BNY Mellon as our global custodian we felt confident of extending our business relationship to include their collateral management service and build this platform with them."
Art Certosimo, senior executive vice president and chief executive officer of Broker-Dealer Services and Alternative Investment Services at BNY Mellon, said: "Pension schemes are looking to find more cost effective solutions for collateral management and the DM Edge platform meets this need. It can accomplish collateral management for simple or complex derivative transactions with user friendly reporting functions as well as real-time margin updates. "
BNY Mellon is the second largest provider of outsourced derivatives collateral management services globally. It is the leading provider of tri-party collateral management services, servicing more than $1.8 trillion in tri-party balances worldwide. BNY Mellon’s collateral management services ranked #1 in 2008 by Global Custodian and International Securities Finance magazine.