Collateral and Limit Management Automation
For one of the largest commodities financiers in The Netherlands, Ionita Consulting was tasked with the improvement of the collateral management, consolidation and reporting across the various offices around the globe. Initiated in the main office in The Netherlands, the project stretched to cover foreign offices in London, Frankfurt, Sydney, Singapore and New York.
Traditionally collateral management is a local practice as each relation and risk manager has his own preference in booking, monitoring and consolidating the client positions. Same holds for exposures, limits and outstandings. However when it comes to global consolidation and reporting, one has to look at the same dimensions to assess risks, aggregate totals.
The assignment included a number of aspects:
1. create a uniform way of booking collateral items
2. automate multi-currency option and include EOD / intra day FX rates
3. consolidate per collateral type and aggregate per client hierarchy
4. automate reporting process
5. integrate with other booking systems (loans, guarantees, LCs, etc)
6. automate loan booking process
7. automate invoicing process
The resulted system allowed business growth, reduction of errors, detection of concentration risks by aggregated reporting, and more importantly an improved way of sharing up to date information with the clients.
Overall the improvement was measured as 10-fold, if a risk manager would have spent on average 10 hours per week in updating, monitoring, consolidating and reporting a client collateral position, now the process would take less than 1h.
In need of Collateral and Limit management process improvement and automation? We are ready to build tools, applications and automations to assist and simplify the routine and repetitive manual activities for all stakeholders involved.