Broadridge Financial Solutions has successfully completed a pilot with Natixis and Societe Generale which leverages blockchain technology to enhance the operational efficiency and auditability of bilateral repurchase, or repo, agreements.
The pilot utilises distributed ledger technology capabilities to reduce operational risk for market participants by providing a secure record of repo trade details, reducing the need for reconciliation and removing obstacles to straight through processing. This new blockchain-enabled solution, which automates end-to-end processes, streamlines the repo agreement and confirmation processes, offers a faster and more accurate collateral substitution process, while eliminating time consuming manual interventions, and reduces counterparty risk while increasing auditability.
“This latest blockchain-based initiative reflects our ongoing commitment to leading the development and implementation of innovative solutions that have the ability to make complex business processes in capital markets firms more secure, transparent and efficient,” says Vijay Mayadas (pictured), President of Global Fixed Income and Analytics at Broadridge. “Within the bilateral repo market, blockchain has shown that it can play an instrumental role in reducing operational cost and complexity.”
“We are pleased to have partnered with Broadridge to initiate the bilateral repo Blockchain process. Our participation in this pilot displays Natixis’ strong commitment to leverage new technologies, aimed at reducing risk and improving efficiencies in the financial markets,” says Kevin Alexander, Head of Global Markets & Investment Banking Americas at Natixis.
“Proving the benefits of blockchain technology in the repo market lays the foundation for the development of broader collateral management solutions on blockchain,” says Jerry Friedhoff, Head of Broadridge’s Securities Finance and Collateral Management group.
