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Collateral Management for Corporates

Collateral Management for Corporates

by Anthony van Eden, Strategic Projects Director, Strate

The global financial industry is in the midst of a period of unprecedented change as it navigates the aftershocks of the 2007-2008 banking crisis. Adapting to these changes is the biggest challenge financial institutions have faced for a long time.

Counterparty credit risk, asset safety and transparency rose to the fore following the collapse of many large institutions. The realm of securitised borrowing and lending has traditionally been limited to pockets of banking and central bank activities, whereas elsewhere, unsecured bank deposits were common and went unquestioned.

As a value proposition, collateralising a loan or term deposit provides greater asset safety and protection from counterparty credit risk.