Cash, Collateral and Liquidity Management across all Currencies and Businesses

We helped a large tier 1 bank gain a consolidated view and clear action plan for their entire collateral portfolio.

Our client

A large Tier 1 bank requiring a consolidated view of their global cash and collateral positions, and an automated infrastructure to address their intra-day liquidity challenges.

Our challenge

Our client was unable to manage nostro balances or liquidity across all businesses, geographies and currencies within their group; an opportunity worth £60m a year through a reduction in charges and additional PnL from more efficient overnight lending. Our challenge was to identify a strategic solution for both cash and collateral management, and to secure an implementation strategy that delivered the greatest benefit most quickly, along with the optimum data sources.

Our approach

Our client required fast action. This was our approach.

  • We specified detailed functional and non-functional requirements across 16 functional components of funding and liquidity management, for both cash and collateral.
  • We surveyed the vendor landscape for potential solutions.  Through an RFI, vendor demonstrations and a detailed evaluation, we reduced 15 candidates to three possible solutions.
  • We then specified, planned and estimated an internal build option.
  • We evaluated all three vendor solutions, and the internal build, against delivery risk, benefits release and cost. Two packages were eliminated at this stage.
  • We conducted a forensic analysis of more than 50 applications to identify optimum data sources and provide complete coverage across major  currencies, products and geography.

As a result of our findings, we recommended that our client built the data management components internally, and that they should buy processing and reporting functionality through a package, as we believed this gave our client the optimum combination of benefits release and delivery risk.

Our enduring effect

Following our client’s technology teams decided to pursue the internal build option: a 5 year development programme and did so with a complete understanding of the functional specification, and the data sourcing and integration requirements.