Collateral Management Fundamentals

Price: $995   Register now

Recommended that you register at least two weeks in advance.

Course Features

  • Course date:03/04/2020
  • Course Duration: 1 Day
  • Level: Beginner
  • Prerequisites: Knowledge of CM
  • Method: Live & Virtual
  • Venue: MicroTek
  • Time: 9:00 am – 5:00 pm
  • Dress Code: Business Casual

Collateral Management Fundamentals

This one-day program examines Collateral Management as the cornerstone of Counterparty Credit Risk Management for businesses as diverse as repo, cleared and uncleared derivatives, margin, and stock loan. Explore the importance of collateral management as a method of credit enhancement and risk mitigation.  Recent market events and regulatory trends have an impact on both the supply and demand of high-quality collateral and underscore the importance of collateral optimization.   Discover how financial firms and their clients manage their collateral inventory and deal with associated operational risks and areas of exposure.

Session 1: Collateral Management Overview

By the end of this session, participants will be able to:

  • Explain the purpose of collateral in the management of counterparty credit risk
  • Understand how credit risk exposure is calculated and quantified
  • Demonstrate usage of collateral in the OTC Derivatives Market
  • Discuss collateralization for repo and securities lending transactions
  • Describe collateral requirements for TBA transactions
  • List types of collateral used by dealers and asset managers
    • Discuss why certain types used by market participants
    • Discuss collateral eligibility profiles
  • Identify the parties involved in managing collateral

Session 2: Documentation

By the end of this session, participants will be able to:

  • Describe the legal structures for collateral relationships
  • Identify the agreements used for managing collateral
    • ISDA® Credit Support Documents and CSAs
    • Master Repo and Securities Lending Agreements
    • Collateral agreement for forward-settling trades in mortgage-backed securities: Master Securities Forward Transaction Agreement (MSFTA).
  • Explain what is used and what is negotiated
  • Discuss enforceability

Session 3: Collateral Terminology

By the end of this session, participants will be able to:

  • Determine collateral requirements
  • Explain and apply the following:
    • Independent amounts (initial margin)
    • Haircuts (valuation percentage)
    • Threshold amounts
    • Minimum transfer amounts
    • Interest on collateral

Session 4: Collateral Workflow

By the end of this session, participants will be able to:

  • Describe and explain the following features of the margin and collateral workflow:
    • Position Tracking and Timing
    • Daily monitoring of collateral positions
    • Margin calculations
    • Margin call notice
    • Responding to margin calls
    • Removing excess collateral and adding collateral
    • Reconciliation procedures
    • Non-delivery
    • Default
    • Escalation processes

Session 5: Dispute Resolution

By the end of this session, participants will be able to:

  • Discuss why disputes arise
  • Determine how to avoid disputes
  • Explain how to resolve disputes
  • Describe ISDA® protocol

Session 6: Collateral Management – Issues and Trends

By the end of this session, participants will be able to:

  • Identify collateral Management issues specific to Act of 40 funds
  • Explain re-hypothecation and posting dealer-owned collateral vs. client-owned collateral illustrating the different operations and legal issues
  • Determine need for and use of Tri-party Agreements and Collateral Control Agreements
  • Collateral Optimization
  • Collateral Transformation

Session 7: Relationship of Netting and Collateral Management

By the end of this session, participants will be able to:

  • Explain business, legal and regulatory conditions for netting
  • Identify benefits of Netting
  • Define and explain Master Netting Agreements
  • Identify types of netting and their purpose
  • Discuss the relationship between Netting and Collateral Management
  • Discuss CVA and impact of netting


  • Charlotte is a broadly accomplished financial services executive with over 25 years of comprehensive experience in delivering innovative and cost-effective operations and technology training solutions for equities, derivatives and fixed income product lines.  Her successful career as a senior-level manager in Operations at Credit Suisse, Paine Webber and Bankers Trust furnishes the industry expertise that …
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