Citi has added segregated collateral custody Accounts to its Citi OpenInvestor suite of investment services, to enable clients to effectively diminish counterparty risk, offer asset safety, and improve collateral efficiency.
In order to counter emerging regulatory requirements, the capability will assist clients to support new requirements under Dodd-Frank and European Market Infrastructure Regulation (EMIR) rules.
Citi investor services managing director Chandresh Iyer said, "The possibility that every OTC relationship may need collateral accounts under new regulations has driven client demand for more efficient solutions."
Citi will serve as an intermediary between the pledgor and the secured party, for tri-party account control arrangements (ACA), holding pledged collateral in a segregated custody account.
For monitoring pledged collateral positions in a highly automated manner, Citi’s new solutions will allow pledgors to instruct transactions on the collateral account and secured parties, within the terms of each ACA.
The suite of new collateral custody technology also provides automated substitution control for rapidly changing collateral portfolios, collateral monitoring for complex collateral portfolios, and margin manager cash reinvestment for Citi clients with US dollar onshore accounts.
It offers institutional, alternative and wealth managers with middle-office, fund services, custody, investing and financing services that are concentrated on their specific challenges and taiolred to their individual needs.
Operating as a division of Citi’s Institutional Clients Group, Citi Transaction Services delivers integrated cash management, trade, and securities and fund services to multinational corporations, financial institutions and public sector organizations.
The company serves more than 65,000 clients and had on average $428bn in liability balances and over $13.2 trillion in assets under custody, as of the fourth quarter of 2012.