New Excess Collateral Pool at Eurex benefits Clearing Members

Eurex Clearing has recently launched a new functionality for Clearing Members that has the potential to significantly improve the operational processes that manage intraday margin calls. The Excess Collateral Pool can reduce the number of intraday margin calls that Members must respond to by using collateral already delivered to Eurex Clearing more efficiently. This collateral can now be used to cover multiple margin shortfalls, in respect to different internal margin accounts/ collateral pools, throughout a single trading day.

When an internal margin account is linked to an Excess Collateral Pool that incurs a margin shortfall, Eurex Clearing will transfer an appropriate amount of cash to the collateral pool to cover the shortfall. Internal margin accounts are continuously monitored throughout the day and, should an account become overcollateralized, cash collateral can be transferred back to the Excess Collateral Pool.

“This new functionality has the potential to significantly improve our Clearing Members’ operational processes with respect to intraday margin calls,” says Dmitrij Senko at Eurex Clearing. “Our systems monitor clients’ margins accounts throughout the day to ensure the provided cash collateral is used as efficiently as possible.”

Excess Collateral Pools can be linked to one or more margin accounts and Clearing Members can provide cash – in EUR, GBP, USD and CHF – to constitute a Buffer Margin that serves the same security purpose as Proprietary Margin.

This optional service was launched in late-November and is available now.