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Collateral management — Winners or losers in five years’ time?
During the last network management forum in Athens (NEMA Europe 2015), a number of collateral topics were addressed during a panel that involved key players in the field ranging from central securities depositories (CSDs) to exchanges and custodians. This paper looks ahead at the collateral management world and asks what trends will define the next five years and which players will come out on top. It defines the current state of the collateral management market, analysing the major factors causing disruption and discussing the key players, before outlining the near-future impact of the tri-party collateral management model. The tri-party model is predicted to grow in strength with further cooperation between infrastructures and providers. The paper then looks at how the various players and models should define success. It is important that collateral is liberated from silos and maintains high ‘velocity’ while meeting regulatory requirements, as well as being flexible enough to meet various client needs and operating models, as well as making good time to market. Custodians have had to adapt and develop offers to cope with the new market demand. They will have to embrace the tri-party model and cope with disruptive technologies such as distributed ledger systems in order to come out on top.
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Philippe Ruault is head of clearing and custody solutions for BNP Paribas Securities Services. He is responsible for developing the bank’s clearing and global and local custody franchise worldwide, including its global clearing and custody network. Philippe joined BNP Paribas in 2001 and has held positions in Paris and London, where he was head of financial intermediaries from 2009 to 2011. He started his career at JP Morgan in 1992 and has held senior consultant positions with Accenture and PricewaterhouseCoopers Management Consultancy. Philippe is a graduate of the European Business School.