BELLIN, leading global provider of treasury management software, offers its clients not only functionality like integrated matching but also electronic processing of letters of credit as standard with the update of their treasury management system tm5. BELLIN has responded to the ESMA-required Level II Validation for EMIR reporting in advance of the requirements deadline. In addition to the changes imposed by ESMA, the tm5 update will provide as standard the full and complete reporting of commodity futures in accordance with EMIR.
EMIR reporting already in line with ESMA-required Level II Validation
On November 2nd, the content and formats for the ESMA-required reporting of derivatives will change. With the tm5 system update, integrated EMIR reporting is possible in accordance with Level II Validation, also in terms of additional reporting content required for some transactions. “With the continuous development of tm5, we are pleased to be able to equip our customers with functionality to meet increasing demands, so that they feel relaxed as they face the EMIR Level II Validation,” shared Martin Bellin, founder and CEO of BELLIN.
The possibilities in the measurement of interest rate instruments were especially expanded with the system update.
Credit value adjustments and debit value adjustments (CVA / DVA) can be taken into consideration for the valuation of money market deals, loans, interest swaps and FRAs. tm5 supports the risk-adjusted discount rate method as valuation model. Moreover, integrated multi-curve valuation is now supported for the valuation of variable interest rate instruments. In addition to the discounting curve for various reference rates (e.g. 6M-Euribor vs. 3MEuribor), several tenor curves are used to establish the forward rate.
BELLIN Matching Service Expanded
The existing BELLIN Matching Service has also been expanded to compare additional transaction types. In addition to the already previously possible confirmation of FX transactions, it will now be possible to send and receive electronic confirmation for Money Market Deals (MT320) and Plain Vanilla FX Options (MT305). The messages are sent via the integrated SWIFT connection in tm5 directly to and from the banks and are automatically processed in the system. This occurs with extremely short notice and thus forms another cornerstone for fulfilling the requirements of EMIR.
Electronic processing of letters of credit
After the optimization of bank communication, BELLIN embraced a new, very paper-based theme. As part of the optimization of the processes around the topic of trade finance, the electronic opening letters of credit is now possible as standard in tm5. The message is sent via the client’s SWIFT code and is fully integrated into tm5: opening, authorizing, sending, managing, monitoring and adjusting LCs can be handled either by the central treasury or in each group company. Immediately after the opening and execution report by the banks, the data is automatically transferred to the financial status. With electronic processing of letters of credit, companies have the possibility to optimize their internal processes globally and monitor the respective credit lines and have an overview of the various maturities. "The fully integrated LC opening gives companies a whole new clarity and transparency in this area of business, and very quickly with only little effort," says Martin Bellin., With regards to the internal approval of letters of credit, users can be authorized to have exclusive authorization rights or shared authorization rights according to the dual approval principle. "Thus, the requirements for compliance and security are also achieved," explains Martin Bellin.
Comprehensive and fully integrated reporting of commodity futures
In addition to the previously available representation of OTC commodity futures, a specific deal type will now be available that reflects the special characteristics of futures: basic data, such as commodity, maturity and contract volume are entered once; subsequently, multiple contract purchases and sales can be edited separately. Within the framework of EMIR reporting, both transaction and position reports are generated. The corresponding UTIs are maintained separately at contract level and at transaction level. The integration of messages in accordance with EMIR offers all impacted companies the ability to fulfill – and thus completely monitor and verify – the reporting obligations on their own.