The new era for collateral: Optimisation, funding and yield strategies

The growth of regulatory requirements has drastically increased the magnitude of collateral consumption for buy-side market participants in recent years. This has forced companies to rethink their strategies surrounding collateral consumption, trading and collateral yield strategies. With a specific focus on pension and insurance companies, this paper discusses some of the challenges that these institutions are facing and makes actionable recommendations towards collateral optimisation practices. Further, it provides guidance towards prudent liquidity management and raises essential elements for collateral-driven revenue generation.