Clear views of global inventory across products and business lines has become the holy grail for many financial firms in recent years. Increasing regulation is resulting in significant cost pressures and managing inventory in a holistic way can provide significant efficiency benefits.
It allows the firm to internalise client orders before sourcing securities more expensively from the street. It also forms the foundations of collateral optimisation, generating huge cost savings from selecting cheapest to deliver assets from a wider pool of inventory.
More advanced optimisation techniques streamline collateral allocation across the entire collateral portfolio and across all counterparties. Once again, a consolidated view of inventory and exposures is a fundamental building block of this process.
Easier Basel III Compliance
From a liquidity management point of view, holistic views of inventory also help the firm to hold onto more liquid assets to satisfy Basel III Liquidity Coverage Ratios, rather than needlessly pledging them out. Centralised inventory management provides a vital tool in finding the right assets within the firm and allocating them to the right place at the right time.
Finally, in terms of management reporting, it makes sense to have a single central data point based around one core system, rather than running reports across multiple disparate systems and then attempting to collate the results.
Centralise and Aggregate Your Global Inventory
To support this integrated position keeping, 4sight's Xpose Collateral Management solution offers a centralised inventory manager that can aggregate inventory across the firm's hierarchy and geographical locations.
Inventory feeds from a multitude of sources are loaded into the system via interfaces to upstream trading systems, both internal and third party. They are then organised into a hierarchical company and book structure that matches your firm's unique structure. This allows you to view available inventory and exposures at any level, for example, at custodian, sub custodian, account level, or even the dividend entitlement level.
The 4sight Inventory Manager provides a real time view of all available assets available for loan, on loan (where Securities Lending functionality is enacted), Repo'd out/in, or received as collateral and available for rehypothecation. Interfaces to upstream trading systems or inventory aggregator allow users to view the trade data and inventory updates in real time. It is also possible to easily identify positions with pending corporate actions.
Rely on 4sight's Expertise in Global Inventory Consolidation
Consolidating inventory management can be a significant undertaking for any financial firm, particularly those with large, complex structures and multiple technology solutions. However, 4sight has a wealth of experience implementing cross product, multi-entity inventory management projects for some of the world's largest financial institutions.
We can therefore help to minimise the complexity involved in consolidating data, allowing customers to enjoy the benefits of the integration project quickly with minimal disruption.
For further information on the 4sight Global Inventory Management Solution or a product demonstration please Contact Us
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