“By adding CME Group to our optimisation service we are able to amplify the risk reduction opportunities across our network, generating increased capital and margin benefits for all of our clients,” said Andrew Williams, CEO of Quantile. “The significant reduction in risk, and margin savings from this cycle are clear examples of the efficiencies that can be generated by taking part in these multi-dealer and multi-CCP processes.”
Quantile analyses clients’ trade data to create transaction solutions that reduce counterparty risk. According to the firm, this results in lower capital and margin costs for derivative market users and increased market liquidity.
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The company’s margin optimisation service enables dealers to benefit from the different product offerings and netting sets available at different clearing houses.
Quantile – Reducing Margin Obligations
Quantile claims that adding CME Group to their optimisation run reduces clients’ margin obligations by using different Central Counterparties (CCPs). Currently, Quantile’s optimisation service is live at the G15 dealers, CME Group and the London Clearing House.
The cycle that was just completed saw CME Group generate over $1.2 billion in NDF clearing across a number of different currency pairs from several banks including Citi and Standard Chartered.
“Standard Chartered has always sought to take advantage of every opportunity that will reduce the use of scarce resources,” said Matt Turner, Director, XVA Trading at Standard Chartered. “Since the commencement of the optimisation cycles we have seen significant savings in our overall margin requirements and by widening the number of participants, we see potential for increasing this benefit further.”