Broadridge Completes Blockchain Pilot for Repo Agreements

Blockchain, FinTech | October 19, 2017 By:

Broadridge Financial Solutions has completed a pilot project that leverages blockchain technology for bilateral repurchase (repo) agreements.

A repo is a form of short-term borrowing for dealers in government securities. The dealer sells the government securities to investors, usually on an overnight basis, and buys them back the following day.

Broadridge worked with French banks Natixis and Societe Generale on the blockchain pilot, which utilizes distributed ledger technology (DLT) in order to make complex processes “more secure, transparent, and efficient.” The blockchain solution automates end-to-end processes, and streamlines the repo agreement and confirmation processes. It offers a faster and more accurate collateral substitution process while eliminating time consuming manual interventions, and reduces counter-party risk while increasing auditability.

Vijay Mayadas, President of Global Fixed Income and Analytics at Broadridge, said that within the bilateral repo market, blockchain has shown that it can play an instrumental role in reducing operational cost and complexity.

Jerry Friedhoff, Head of Broadridge’s Securities Finance and Collateral Management group, said that proving the benefits of blockchain technology in the repo market lays the foundation for the development of broader collateral management solutions on blockchain.

Broadridge Financial Solutions provides investor communications and technology-driven solutions for broker-dealers, banks, mutual funds and corporate issuers globally. The company’s investor communications, securities processing, and managed services solutions help clients reduce their capital investments in operations infrastructure, allowing them to increase their focus on core business activities.