Saturday 30th August 2014
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South Africa’s central bank has disagreed with a ratings decision by Moody’s to downgrade Capitec Bank Limited (Capitec) by two notches, and place it on review for a further downgrade. The central bank says it respects the independent opinion of rating agencies but that it does not “agree with the rationale given in taking this step”. Two reasons are given for the rating action: a lower likelihood of sovereign systemic support based on decisions recently taken in relation to African Bank Limited (African Bank), and heightened concerns regarding the risk inherent in Capitec’s consumer lending focus. “With regard to the first point, it is important to reiterate that the approach taken by the SARB to any resolution to address systemic risk will always be based on the circumstances and merits of the particular prevailing situation. Decisions will also be informed, as was the case with African Bank, by principles contained in the Key Attributes for Effective Resolution Regimes proposed by the Financial Stability Board (FSB), which have the objective that a bank should be able to fail without affecting the system,” notes the central bank in an official statement. “This is in keeping with evolving international best practice. In the case of African Bank bond holders and wholesale depositors are taking a 10% haircut, which is generally regarded as being very positive given that the trades following the announcement of African Bank's results were taking place at around 40% of par. Therefore in fact substantial support was provided, not reduced. Moreover, all retail depositors were kept whole and are able to access their accounts fully,” it adds - According to the Hong Kong Monetary Authority (HKMA) credit card receivables increased by 2.1% in the second quarter to HKD112, after a reduction of 6.7% in the previous quarter. The total number of credit card accounts edged up by 0.7% to around 16.8m.The rollover amount, which reflects the amount of borrowing by customers using their credit cards, increased by 2.9% during the quarter to HKD19.2bn. The rollover ratio also rose marginally from 17.0% to 17.1% in the same period. The charge-off amount increased to HKD569mduring the quarter from HKD528m in the previous quarter. Correspondingly, the quarterly charge-off ratio rose to 0.51% from 0.46% in the previous quarter. The amount of rescheduled receivables transferred outside the surveyed institutions’ credit card portfolios reduced to HKD94m from HK$109m in the previous quarter. The delinquent amount increased to HKD249m at end-June from HKD239m at end-March. However, the delinquency ratio remained the same at 0.22% because of an increase in total card receivables. The combined delinquent and rescheduled ratio (after taking into account the transfer of rescheduled receivables mentioned above) edged up to 0.29% from 0.28% during the same period - Harkand has been awarded a contract to support Apache with inspection, repair and maintenance work (IRM) as well as light construction (LC) across their assets in the North Sea, following completion of a competitive tender exercise. The award includes the provision of vessels, ROV and diving services for a three-year period, plus two one-year options. The firm will also support offshore marine construction contractor EMAS AMC who have been awarded a separate contract for pipe lay and heavy construction as part of the same tender process. Harkand Europe managing director, David Kerr, said: “This contract is an important step in strengthening our close working relationship and growing our North Sea business with Apache.

OMGEO adds new collateral management functionality to Omgeo ProtoColl

Monday, 18 June 2012
OMGEO adds new collateral management functionality to Omgeo ProtoColl Automated trade services provider Omgeo says new functionality is now available on Omgeo ProtoColl®, its automated collateral management solution. The new version of ProtoColl has been developed to help market participants manage their collateral and risk management operations ahead of the implementation of complex regulatory requirements for over-the-counter (OTC) derivatives clearing, explains the firm. http://www.ftseglobalmarkets.com/

Automated trade services provider Omgeo says new functionality is now available on Omgeo ProtoColl®, its automated collateral management solution. The new version of ProtoColl has been developed to help market participants manage their collateral and risk management operations ahead of the implementation of complex regulatory requirements for over-the-counter (OTC) derivatives clearing, explains the firm.

Ted Leveroni, executive director of Derivatives Strategy and External Relations at Omgeo, explains that: “We are seeing increased focus on automated collateral solutions as firms recognize that they need to act now to prepare their internal processes ahead of the implementation of new regulatory mandates including Dodd-Frank and EMIR. While the regulations are still to be finalized, there will always be the need for both bilateral and centrally cleared capabilities and ProtoColl gives clients the ability to manage both from a single platform today.”

The newest ProtoColl enhancements, available in version 7.5, provide market participants with a single, holistic view of their collateral exposures across bilateral and centrally cleared (CCP) OTC derivatives trades, as well as exchange traded derivatives and other collateral-related transactions such as repurchase agreements and securities lending activities. Users can manage the entire collateral life-cycle with ProtoColl, allowing them to execute robust counterparty risk management procedures and demonstrate the results to regulators and investors.

According to a report by Finadium on collateral management, collateral required in the OTC derivatives market alone will see a growth of 41 per cent over the next 12-18 months, partly as a result of the structural changes taking place in the derivatives markets. In response to users’ concerns over the increased complexities and cost of collateral management, Omgeo has developed the new version of ProtoColl as an all-in-one dashboard solution for true exception-based collateral management, allowing users to focus on those events requiring oversight and judgment. 

Omgeo ProtoColl’s  workflow capabilities manage daily margin activity, and track all progress during the day. It supports automatic calculation and posting of collateral requirements and the subsequent initial and variation margin movements for all relevant asset classes. The system can automatically issue call and recall notices, flag disputes, record and process adjustments and identify required margin movements. These views provide consolidated reporting and management of counterparty exposures and margin calls.

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