InteDelta InSight on Initial Margin
Recent regulatory reform has brought Initial Margin to the forefront of the agenda for OTC derivatives and, in response, financial institutions are making significant investments into systems and business process to address the business challenges which this presents.
The concept of Initial Margin is familiar to many market participants and has - for many years - been used to cover future exposure variations in particular classes of financial instrument or with particular classes of counterparty. However, these uses of Initial Margin were often non-systematic and selectively implemented. In this first issue of InteDelta InSight we consider the latest Initial Margin related developments for OTC derivatives, how these will impact financial institutions and how the industry is reacting to the challenges involved.
About InteDelta
InteDelta helps financial institutions implement risk management best practice. Combining a structured consulting approach with subject matter expertise, we work with our global client base to implement risk management best practice. Our areas of expertise cover the major risks faced by financial institutions: credit, market, liquidity and operational risk, alongside niche specialisms such as collateral management. Our clients have a global spread, ranging from some of the world’s largest banks and asset managers to developing market banks, hedge funds and risk software vendors.
