Shanghai Commercial Bank Adopts Bloomberg’s Collateral Management Solution for Phase VI Uncleared Margin Rule

Hong Kong – Bloomberg announced today that Shanghai Commercial Bank (“SHCB”), a leading bank in Hong Kong with a presence in the United Kingdom, United States of America and Mainland China, has adopted Bloomberg’s Multi-Asset Risk System (MARS) Collateral Management solution to support its preparation for regulatory requirements pertaining to Uncleared Margin Rules (UMR).

To better comply with upcoming UMR requirements from local and global regulatory regimes, SHCB began their search in 2019 for a solution to fully manage their collateral and margin calculation. In view of this regulatory requirement, the bank sought a robust technology solution that was recognized among ISDA’s SIMM Licensed Vendors. In addition to selecting MARS Collateral Management for its collateral management and margin calculation needs, SHCB integrated Bloomberg’s SIMM methodology licensed from ISDA, with its existing third-party trading workflow, for calculating initial margin requirements for non-centrally cleared derivatives.

“2020 accelerated our implementation of technology to better comply with UMR requirements,” said Edmund Lai, Chief of Treasury at Shanghai Commercial Bank. “MARS Collateral Management was the ideal global risk management solution to support our fast-growing global structured products business and Bloomberg’s coverage of multi asset derivatives, including structured products, was key to why we selected them.” He added, “With the support of Bloomberg, we were able to seamlessly implement the technology during this challenging virtual operating environment with minimal disruption, resulting in an optimized workflow that is ready for UMR.”

SHCB sought a seamless workflow to meet the UMR requirements across the breadth of its portfolio. MARS Collateral Management provides risk analytics, integrated data and automated workflows to help reduce operational and credit risk. Its suite of products incorporate risk-based solutions for margin, valuation and collateral management, helping firms monitor their initial margin requirements for pre-trade and back-testing needs. MARS Collateral Management was recently awarded, ‘Best Collateral Management and Optimisation’ product from Risk.net in 2020. Bloomberg was also awarded ‘Best Pricing and Risk Analytics Provider’ at the Structured Retail Products Asia-Pacific Awards in 2021.

Siti Eschrich, Bloomberg’s Collateral Management Product Manager, said, “We are excited to work with Shanghai Commercial Bank to support the regulatory needs of their operating environment.  As we approach the final phase of the UMR, clients require a mature and robust solution to settle margin obligations with counterparties who are already in scope with previous phases. Bloomberg’s risk management solutions are well positioned to support clients with evolving global regulatory demands and optimize complex multi-asset workflows.”

MARS Collateral Management has built-in portfolio reconciliation tools to communicate and resolve disputes. It calculates, aggregates and displays margin calls across products and legal entities and generates independent derivative and collateral valuations and liquidity risk scenarios. It can be used to manage the day-to-day margin call process, including sending margin calls, booking collateral, and managing interest payments. Clients can track their exposures, as well as collateral positions and agreement terms in real-time. Subscribers to the Bloomberg Terminal can find more information at <RISK> or click here to request a demo.

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About Shanghai Commercial Bank

Incorporated in November 1950, Shanghai Commercial Bank Limited (“the Bank”) has been one of the most distinguished local Chinese banks in Hong Kong. At present, we have over 50 branches across Hong Kong, mainland China and overseas, with a business network reaching the United Kingdom, the United States of America, Shanghai and Shenzhen, to offer our customers comprehensive banking services with convenience.

We strive to meet our customers’ needs with a wide range of retail and corporate banking products and services, including deposits, loans, remittances, foreign exchange, credit cards, securities trading, international banking, insurance services, gold services, RMB services, internet and mobile banking, all designed and provided with our motto, “For Personalized Service” in mind.

Since the late 1990s, the Bank has formed a strategic alliance with Bank of Shanghai in mainland China and The Shanghai Commercial and Savings Bank in Taiwan, to broaden its service network and provide customers with cross-strait banking services in the Greater China region.

About Bloomberg

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Media Contact

Robert Koh, rkoh22@bloomberg.net, +852-2977-2101