Strate enables Sanlam Life Insurance Limited’s first seamless, automated exchange of Regulatory Initial Margin
Strate Collateral Services is pleased to announce that we have successfully enabled our first non-bank client to meet their Regulatory Initial Margin (Reg IM) exchange obligations. Using our triparty collateral platform, Sanlam Life Insurance Limited (Sanlam) and their bank counterparts are able to exchange Reg IM in an automated and seamless process and continue to do so daily to meet their mark-to-market requirements.
Comprehensive testing with Sanlam highlighted the simplicity and benefits of automated, straight-through processing, based on their defined rules and parameters, thereby affirming their decision to use our collateral platform.
“Executing our first successful exchange of initial margin on the Strate platform within a compressed timeframe is a significant milestone for Sanlam. This transaction required close coordination across legal, operational and regulatory compliance teams, supported by constructive engagement with the regulatory authorities. Strate’s platform provides simplicity and strong operational control through automated allocation and substitution of collateral, ensuring accuracy, efficiency and full compliance in our daily initial margin management. This achievement reflects the strength of our governance and the quality of our chosen partners as we continue to integrate into global markets,” says Craig Brookes, Sanlam Financial Markets Collateral Management.
Clients using Strate’s triparty collateral management platform can easily achieve regulatory confidence and alignment. Eligibility rules are set within the system, based on the requirements of Joint Standard 2, 2020 and the system automatically allocates, optimises and substitutes eligible collateral securities in accordance with these rules. Natural segregation of collateral assets on contract level and the avoidance of re-hypothecation entrenches regulatory compliance.
“The initial margin regulatory framework requirement disrupted the market, presenting firms with complex operational challenges. Achieving consistent alignment of initial margin processes across both local and international counterparties was key to operational efficiency.
The Strate solution played a key role in enabling our business to successfully standardise and align these processes, ensuring full compliance with initial margin regulatory requirements. The Strate platform offers a seamless, efficient end-to-end workflow that significantly reduces manual intervention while reducing operational risk. By leveraging the Strate platform, Absa successfully optimised collateral usage with remarkable efficiency,” says Jennitha Jugnath, Head of ACS and Prime Services Operations at Absa.
“The Strate team provided exceptional support throughout the implementation, facilitating comprehensive testing with all relevant parties and ensuring a smooth, issue-free transition into production. Absa looks forward to expanding the use of the Strate platform with other counterparties in the near future,” she adds.
For information on how our solution could benefit your collateral management processes, please visit https://www.strate.co.za/collateral-services or email collateralmanagement@strate.co.za.
