Bridging the Collateral Divide

Increasing inventory mobility across a fragmented marketplace

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Bridging the Collateral Divide

Increasing inventory mobility across a fragmented marketplace

November 2021

By BNY Mellon and Euroclear 

It has long been known that the global collateral landscape is somewhat fragmented, making it challenging for market participants to deliver securities easily to locations where they can be posted efficiently as collateral.

Now, in a new joint thought leadership paper, BNY Mellon and Euroclear shed light on the global collateral landscape and the current challenges it presents and proposes improvements to make the movement of collateral around the world more streamlined.

The paper, Bridging the Collateral Divide, gives the marketplace a sense of the overall collateral landscape by showing the composition of collateral held by common clients at the two largest collateral infrastructure providers.


For the first time, this paper evaluates the true extent of this fragmentation by analyzing BNY Mellon’s and Euroclear’s collateral businesses. This analysis examines the number of common collateral clients between the two firms, the types of securities these clients are holding as collateral assets, and the financing activity this collateral is being used to support, such as repo, securities finance and over-the-counter derivatives transactions.


The paper concludes by advocating for a number of steps that can be taken by the collateral industry to promote the mobility of securities inventory and the velocity with which collateral can be delivered to where it is needed. 


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