Mitigating Collateral Damage: Current Themes in Managing and Mitigating Counterparty Credit Risk for OTC Derivatives

The financial crisis re-emphasized the importance of counterparty credit risk, and the subsequent industry-led program of reform has addressed many of the shortcomings of the OTC market. BNY Mellon and independent consulting firm InteDelta investigated current counterparty credit risk management policies and processes across a representative sample of asset management, insurance and pension fund institutions. Findings from this research reveal an evolving OTC derivatives market that is wary of risk, open to change, and surprisingly robust.

Authors:   Jonathan Bowler, Mark Higgins, Stephen Ingle, David Brown, Michael Schroeder, Chris Coleman, Patrick Tadie, John Templeton
In collaboration with:   InteDelta
Business:  Asset Servicing
Publication date:   January 2011

Mitigating Collateral Damage: Current Themes in Managing and Mitigating Counterparty Credit Risk for OTC Derivatives (UK English)

The financial crisis re-emphasised the importance of counterparty credit risk, and the subsequent industry-led program of reform has addressed many of the shortcomings of the OTC market. BNY Mellon and independent consulting firm InteDelta investigated current counterparty credit risk management policies and processes across a representative sample of asset management, insurance and pension fund institutions. Findings from this research reveal an evolving OTC derivatives market that is wary of risk, open to change, and surprisingly robust.

Authors:   Jonathan Bowler, Mark Higgins, Stephen Ingle, David Brown, Michael Schroeder, Chris Coleman, Patrick Tadie, John Templeton
In collaboration with:   InteDelta
Business:  Asset Servicing
Publication date:   January 2011

An Examination of the Latin American Pension Systems - The Challenges Ahead

Latin America's economic ascendancy exemplifies the success in debt and inflation management and the solidification of democratic rule. While not facing the imminent demographic challenges of the developing world, the long-term macroeconomic viability of the region is predicated upon building upon prior structural reforms, namely pension reform to ensure popular expectations are met within the realm of fiscal responsibility. To achieve this objective, public-private partnerships will need to consider certain recommendations.

Author:   Michael Kalavritinos
Business:   Asset Servicing
Publication date:   January 2011

Regulatory Reform: The Shape of Things To Come

Reprinted with the permission of Incisive Media Services Limited

Transparency, reporting and ongoing regulatory reform are key issues in the derivatives marketplace. While many are aware of the Dodd-Frank Act, the full impact of the law remains unclear. Patrick Tadie, Global Head of Derivatives360, discusses the major challenges facing financial institutions in this new regulatory environment and outlines ways to prepare for these challenges.

Author:   Patrick Tadie
Business:  Asset Servicing
Publication date:   February 2011

Evaluating the Post-Crisis Tri-Party Repo Market

The financial crisis of 2008 - 2009 prompted regulatory agencies worldwide to re-examine systemic risks in various markets and re-evaluate the way that many transactions are conducted. The Task Force on Tri-Party Repo Infrastructure was created to identify risks that could be mitigated in tri-party repurchase transactions and to recommend actions to help avoid these risks in the future. While such steps are necessary to bolster confidence in our financial markets, institutions must look at the costs involved and decide how best to adhere to new initiatives while still maximizing the potential for yield.

Business:   Asset Servicing
Publication date:   March 2011

Key Elements of CCO Oversight of Service Providers

Reprinted with the permission of Institutional Investor News

Rule 38a-1 under the Investment Company Act of 1940 requires that investment companies adopt comprehensive compliance programs including written policies and procedures and designation of a chief compliance officer (CCO). For fund clients that have limited resources or choose not to build the infrastructure needed to comply with all requirements of Rule 38a-1, service providers can fulfill an important function -- providing CCOs with the necessary tools, information and insights to meet their oversight obligations.

Author:   Martha Fox
Business:   Asset Servicing
Publication date:   March 2011

VIDEO: Exchange Traded Funds - Catalyst for Change and Growth

Exchange traded funds have proven to be a catalyst for rapid change in the investment landscape. Joe Keenan, Head of Global ETF Services for BNY Mellon Asset Servicing, discusses the exponential growth of this important investment tool, which trades like a stock, but contains numerous asset types. Joe cites three key reasons we expect continued growth of ETFs: new market entrants, product innovation and geographic expansion.

Author:   Joe Keenan
Business:   Asset Servicing
Publication date:   March 2011

VIDEO: Executive Insights - Regulation, Technology and the Modern-day Asset Servicer

Tim Keaney, CEO of BNY Mellon Asset Servicing, talks to Bill Salus, Head of U.S. Sales and Marketing, about the responsibilities and challenges of looking after other people's money. Keaney reflects on the sheer size and importance of what we do for clients. He also talks about the impact of regulatory reform and the need to invest in technology to build new products, enter new markets and provide new solutions for clients.

Authors:   Tim Keaney, Bill Salus
Business:   Asset Servicing
Publication date:   March 2011

Fast Learner

Reprinted with the permission of International Custody & Fund Administration, icfamagazine.com

When Dan Wywoda walked into the human resources department of the Boston Company in pursuit of a job in 1989, little did he anticipate his career to be where it is today. Fast-forward 22 years and Wywoda is now head of global product management for BNY Mellon Asset Servicing. Learn more about Dan's career in this icfamagazine interview.

Author:   Daniel Wywoda
Business:   Asset Servicing
Publication date:   April 2011

International Financial Reporting Standards -- Are You Getting Ready for IFRS 9?

The changes to accounting standards for financial instruments in IFRS 9 will have significant system and operations implications for organizations. The objective of this paper is to provide an overview of recent changes so that companies can gain a better understanding of the new and potential requirements and how their operations may be impacted.

Author:   Steve Burrows
Business:   Asset Servicing
Publication date:   April 2011