London and New York, 9 August 2005 - JPMorgan announced today the global
launch of JPMorgan CommanDsm, the industry's first full-service derivatives collateral management solution. JPMorgan CommanD has been designed to help financial institutions manage the complexities of using collateral against over-the-counter ("OTC") derivatives trades. JPMorgan CommanD enables clients to better mitigate credit exposure and increase derivatives trading cost effectiveness.
JPMorgan CommanD moves beyond the traditional custodial elements of a collateral management solution by covering many of the post-trade functions along the value chain, including OTC derivatives valuation, credit support annex management, reconciliations, collateral custody and liquidity management. A fully scalable solution, JPMorgan CommanD leverages JPMorgan's extensive collateral management experience and market-leading infrastructure to provide clients with a more cost effective alternative to an in-house collateral management programme.
According to the International Swaps and Derivatives Association (ISDA), collateral in circulation has grown at an average rate of 43% per year since 2000.
"Collateral is well understood as a means of reducing credit exposure, but for many financial institutions managing collateral is costly and proves a drain on resources. JPMorgan CommanD was developed as an agency solution to help clients more effectively handle the collateral process as they continue to grow their OTC derivatives book," said Murray Brown, head of derivatives collateral management for JPMorgan Worldwide Securities Services.
Since 1992, JPMorgan's Clearance and Collateral Management group has provided collateral management services to a large number of financial institutions globally.