Hazeltree, the leading provider of integrated treasury management and portfolio finance solutions for investment managers, announced today the launch of Hazeltree AANA Estimator™, in response to client demand. By September 2022 an estimated 1,000 buy-side firms may meet the threshold for regulatory UMR (Uncleared Margin Rule) Phases 5 or 6 compliance. AANA (Average Aggregate Notional Amount) is the metric which determines whether a firm falls within the scope of the mandate. Hazeltree’s AANA Estimator can utilize a firm’s internal data, or data from their counterparties, to perform this critical calculation. Hazeltree AANA Estimator is available immediately as a dynamic widget within Hazeltree’s collateral management solution.
Hazeltree takes a workflow process approach to UMR compliance, and its AANA estimator is an enhancement to its already robust Hazeltree Collateral Manager™ offering. The process approach was detailed previously and is available in the firm’s Comprehensive Guide to UMR, written with HedgeLegal.
Said Sameer Shalaby, Hazeltree CEO: “Our AANA estimator is an essential tool as firms approach the significant costs and operational burdens of UMR compliance. We are working with clients to improve operational efficiencies in managing collateral with the added requirement of UMR compliance. We are encouraging clients to prepare now for UMR compliance and our AANA estimator is a crucial first step to understanding their obligations.”
Firms who may be in scope for UMR must address several critical questions as deadlines near, including:
- When will the firm be subject to UMR? If not subject to UMR in Phases 5 or 6, how will the firm monitor and prepare for potentially exceeding this important regulatory threshold?
- Is the firm prepared to independently calculate SIMM or standard schedule requirements, or will it rely on its counterparty to provide the daily requirements?
- To independently calculate SIMM, has a vendor been selected to provide that calculation?
- Which custody model for pledging segregated collateral will be used (third-party or tri-party)? Which custodian will be used?
- How will Initial Margin disputes be addressed?
- Is the firm prepared to link together the needed complex UMR components to satisfy the daily regulatory requirements by legal jurisdiction?
“Hazeltree is fully prepared to address the comprehensive concerns of firms as they move to UMR compliance,” Shalaby said. “The AANA Estimator is an important component in that overall UMR package.”