Post-trade specialists the Depository Trust & Clearing Corporation (DTCC) and Euroclear have teamed up to create a new margin settlement process.
The Margin Transit Utility will provide straight-through processing of margin obligation settlement leveraging DTCC infrastructure.
The joint venture will also launch a Collateral Management Utility, which will use Euroclear’s Collateral Highway.
The new firm called DTCC-Euroclear Global Collateral will be based in the UK.
“The company will play a critical role in helping the industry address capital and operational challenges resulting from the vastly increased volume and velocity of margin movements worldwide that are anticipated under regulations promulgated by financial reform legislation such as Dodd-Frank and EMIR,” said DTCC president and CEO Michael Bodson.
The team will be led by Michael Shipton, managing director and head of corporate technology, who will take the role of CEO, and Mark Jennis, DTCC’s managing director, strategy and business development, who will assume the position of executive chairman.
“Firms within the post-trade world span multiple countries, if not continents,” said Euroclear Chief Executive Officer Tim Howell. “By drawing on the combined resources and expertise of two of the largest post-trade infrastructure providers in the world, this strategic partnership with DTCC will play a leading role in addressing the challenge of efficiently allocating and mobilising capital across the globe.”