Professional Documents
Culture Documents
Globalization
Cross Product Collateralization
E-Commerce/Customer Requirement
Risk Management
People
Regulation, e.g .Capital Adequacy, Reg Reporting
Collateral Optimization
Collateral Management
Mark Jennis
Morgan Stanley Dean Witter
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Agenda
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Type of Document pq. Operational Feasibility &
Standards
I Perfection of Security
Interest - Acceptable Collateral
Legal Opinion - Haircuts
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Collateral Threshold - Delivery Times
- Distribution
Criteria For Eligible Collateral
Ability to Price
Non Volatile Pricing
Liquidity
Credit Quality
Settlement ~ i s k
Ability to Perfect a
Security Interest
Deal 1 Collateral
Correlation
Cost
Margin Process
Receive Deal and Collateral Information
Calculate Collateral Requirement
Execute Margin Actions
Source Collateral
Collateral Disputes
Credit Reporting
Periodic Processing
Margin Process-Workflow
I Customer I valuation systems I Collateral ~ g1' It Other I
Collateral Collateral
I values I I Requirement I
Receive Call Margin Call I
Notice I ~ n s u r eEligibility I
Decide what I
collateral to J Collateral I
deliver
Notify Custody of
Pending Collateral
-1 Custody
Receipt
I
Recalculate Margin 4
Collateral Calculations
Margin Frequency
Margin Deadlines
Threshold
Transfer Amounts
Initial Margin / Independent ."
I
Amount
Valuation Discount &n.-$l M- &d,
Independent Amounts
Market Risk
Requirements, Concentration, Liquidity, Volatility, Stress
Credit Risk
Know your client, Transparency, Review
Operational Risk
Asset control, Coordination
Legal Risk
Perfection, Deal Stmcture
~ntir~retation,
Business Risk
Relationship banking
Major Trends
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Credit Analysis and Collateralization
Assessing the Risks that Surround the Collateral
Function - tLId(jyU/
Dispute Resolution -m% ' 72 & &- ( ~ e s d ) * j " )
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Shortening the Collateral C e R e d u c e Exposures ari 9
Expansion of Collateral Types
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Initial Margin
Portfolio Reconciliation
Dispute Resolution -@ . @ /~ / c ~ ~ L * * D o I P
Transfer Timing
Collateral Substitution
Interim Credit Support
Cross-Product Collateralization
Major Challenges
Globalization
Cross Product Collateralization
E-Commerce/Customer Requirement
CostICapacity
Risk Management
People flr--~?,w&B.. ,
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