Societe Generale (SocGen) has announced that its prime services group, formerly known as Newedge, has begun to offer CME Group portfolio margining for its clients. The added benefit for clients is a unified margin structure where exchange traded futures and interest rate swaps (IRS) are combined into a single portfolio to allow for reduced margins when trading CME Group products. The margining works by allowing SocGen customers to place exchange traded contracts within their Legal Segregation with Operational Commingling (LSOC) account which is used for cleared IRSs.
The availability for portfolio margining across different asset classes has been a key differentiator for Newedge even before being acquired and absorbed into SocGen’s operations. The foundation of the service is the prime broker’s cross-asset platform, FX Edge. As a cross-asset offering, it was created to allow prime customers to have a unified portfolio for both monitoring P&L and margin usage. For asset managers and traders, the consolidated portfolio reduces the need to distribute funds between accounts to meet credit requirements of different asset types.
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Commenting about the integration with the CME Group, Nicholas Gionfriddo, Americas Head of OTC Clearing Sales for Societe Generale Prime Services, stated, “This important upgrade to our clearing business allows our clients to optimize their cost of collateral as well as take advantage of capital efficiencies. This investment also further affirms our commitment to OTC Client Clearing following our recent service enhancements introducing clearing for our FX NDF and CDS clients.”