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Omgeo focuses on counterparty risk with ProtoColl and CrossCheck

Posted: 02 February 2009

Omgeo is making available its counterparty risk management solution, comprised of Omgeo ProtoColl (formerly Allustra Kyros), the firm’s automated collateral management offering, and Omgeo CrossCheck (formerly GEM’s FpML Mediator technology), which provides automated portfolio reconciliation.

Omgeo ProtoColl provides an end-to-end, event-driven collateral and margin management workflow solution for fund managers to identify, negotiate and satisfy daily margin calls. By using this system, fund managers can gain insight into their firms’ exposures and risk profiles.

The ProtoColl offering handles all margining requirements, including over-the-counter (OTC) derivatives, repos, securities lending, leveraged trading, emerging markets and loan facilities.

“After reviewing some of the available solutions for collateral management, we determined Omgeo ProtoColl would best suit our needs,” said Muhittin Elvan, head of risk control at Mn Services, the €65 billion pension fund manager and administrator, which is using ProtoColl. “Not only is the technology and functionality the most comprehensive, but because the product was designed specifically with investment management and hedge fund communities in mind, it was the solution that best met our specific needs.

Omgeo said ProtoColl not only identifies any collateral discrepancies, but also gives transparency into those exceptions to highlight which details need to be resolved between counterparties.

Omgeo CrossCheck, another component to the counterparty risk management solution, is a centrally-hosted service that automates the comparison of portfolios of derivatives between investment managers, broker/dealers and other parties. Comparison of economic details (trade date, notional, rate, etc.), payment information and valuation of positions and portfolios is based on custom-defined matching policies.

Omgeo CrossCheck helps minimise the risks and consequences of unaligned portfolios in advance of payments, collateral calls, credit events and other situations.

“There have been far too many examples within the industry lately of what can happen when counterparty risk management is not a strategic priority,” said Tim Lind, managing director of strategic planning at Omgeo. “Automating the processes around collateral management and portfolio reconciliation allows the financial community to proactively handle every aspect of their portfolios of open transactions and collateral balances. The entire industry stands to benefit from firms that prioritize counterparty risk management and we are pleased to enable it.”

In September, 2008, Omgeo acquired Allustra, a London-based provider of collateral management solutions and the portfolio reconciliation platform, FpML Mediator, designed by Global Electronic Market’s (GEM). Omgeo ProtoColl is the enhanced version of what was formerly Allustra Kyros and Omgeo CrossCheck is the new FpML Mediator.

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