The Collateral Management Group compares the Net Present Value of the portfolio of trades between BNP Paribas and its counterparties on a daily (or as specified) basis and ensure that this exposure is sufficiently collateralized.
Portfolio Reconciliation is a risk mitigation technique whereby counterparty’s exchange trade details and a reconciliation of key economic terms, including valuation is performed.
The evolving Regulatory landscape will require further reconciliations as part of dispute prevention associated with Bi-lateral Initial Margin exchange based on risk sensitivity calculations.
Position Purpose
The process requires comparison of exposures with the value of the assets pledged, in accordance with the parameters specified in the legal agreement. Changes in exposure will generate changes in collateral balance. The collateral teams will call for or post additional collateral.
This daily margin call process ensures that the Bank is covered in terms of excessive credit risk exposure.
BNPP performs portfolio reconciliation as a risk mitigation technique for dispute resolution and to be in line with regulatory requirements of EMIR.
Process requires working with clients, Middle Office, P&L; and risk team along with key stakeholders across the bank to report / resolve issues.
The controls function within Portfolio Reconciliation is responsible for ensuring key aspects of the reconciliation process are performed. Controls is also responsible for working with key stakeholders across the bank to report / resolve issues where necessary to minimize counterparty risk and ensuring EMIR compliance.
Responsibilities
Direct Responsibilities
Performing daily margin call process front to back for specified clients.
Margin Call issuance and chasing clients for unanswered margin calls.
Investigating on disputed calls and li