Sheehan: The market has been faced with recent pressures to comply with new regulations and cope with squeezed margins. Many firms have turned to technology to reduce costs and support business innovation. Some agile financial institutions have seized the opportunities the changing regulatory landscape has provided and have looked for a technology partner that can help to transform their business model and seek new revenue opportunities.
Alberta Investment Management Corporation (AIMCo) is one of Canada’s largest and most diversified institutional investment managers with more than $90 billion of assets under management. AIMCo selected Calypso Technology as its partner to simplify and consolidate its collateral management across separate portfolios and business units while also introducing a transparent structure for the optimal use of collateral.
Michael Baker, senior vice president of investment operations at AIMCo: Although we were facing the market under a single name, the management of collateral was decentralised and we were relying on multiple platforms and spreadsheets to monitor, calculate, communicate and process collateral for different strategies. This has been simplified with the implementation of Calypso’s Collateral Management module.
As the same counterparties were used across our internal entities, we realised that there was a more agile way of optimising the pool of collateral available but this would require a centralised view of inventory. We needed a new, centralised system architecture to provide the exposure and available collateral from each unit to our collateral management group while maintaining and displaying the owners of both.
We had a vision of a consolidated system that could give us a simple and transparent view across all funds, allowing us to optimise the use of collateral, seek new revenue streams and improve profit margins.
We selected the Calypso Collateral Management solution and worked in partnership with Calypso Technology to create a transparent portfolio lookthrough where it would be possible to allocate the exposure back to the eligible pools. In addition, the Calypso system offered the possibility to optimise the allocation of fund assets to external counterparties, including the use of rehypothecated collateral with the ability to track the source and destination of the collateral.
The Calypso system allows us to assign a value to the collateral depending on the various demands from different markets we operate in, and enables us to seek new revenue opportunities. The Calypso solution has provided us with a powerful centralised, real-time inventory management view which truly reflects our business model.
Sheehan: This is an example where we have worked in close partnership with a customer to deliver functionality to support its business transformation. This has been a benefit to AIMCo, Calypso and other clients as enhancements are made to our core Calypso product and shared across our client base.
Corinne Grillet, chief customer officer at Calypso Technology: Take the example of BNP Paribas Securities Services, which has a distinguished track record for providing premier client service and operational excellence. We are pleased to be trusted to support its end-to-end post-trade processing services with the Calypso integrated front-to-back architecture.
Amor Chebira, COO of market and financing services at BNP Paribas Securities Services: With the Calypso solution, we have been able to consolidate our securities lending and repo activities resulting in significantly improved collateral management capabilities.