Triparty REPO Process
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A tri-party repo involves a custodian bank holding collateral for a broker/dealer and their client without physically transferring it. The custodian bank issues a confirmation using common identifiers to specify the pledged collateral for the repo contract between the broker/dealer and client. Allocation trades from the client are then matched against the dealer confirmation held by the custodian bank.
Triparty REPO Process
- 1. CASH INVESTOR DEALER CLEARING AGENT CALYPSO CASH Block Trade Allocation Trades Block Trade Allocation Trades Allocation level message from Investor Allocations (rematch) Trade Allocations+ ProprietaryInfo Tri-Party Repo > A custodian bank or international clearing organization acts as an intermediary between the two parties to the Repo and holds the collateral. > Collateral is not moved between the broker/dealer and buy-side firm. Collateral is later specifically identified by a confirmation from the custodian bank holding the securities pledged to the Triparty Repo contract. > The Tri-Party Repo confirmation is identified using General collateral CUSIPS or In-House identifiers familiar to both the broker/dealer and its client. > Allocations will match against the dealer confirmation.