Margin Message Details

This topic describes how to use the Collateral Assignment Process (SRDMRONL) to capture the margin message details and to send a margin call from an external system or initiated manually for a repo or a reverse repo contract.

• During the Repo or Reverse Repo life cycle, as part of collateral revaluation, either margin call is initiated to adjust Securities/cash or repricing of repo or reverse repo by adjusting the nominal amount. This is done based on collateral revaluation preference at the repo product level.
• If Collateral revaluation is by Margin settlement, The user can send a margin call from an external system or initiated manually from the Collateral Assignment Process (SRDMRONL) screen for a repo or a reverse repo contract.
• The available options for Margin type are:
• Securities
• Cash
• The available options for the Margin call are:
• Pay
• Receive
• Based on the above mentioned Margin call and type details, the following table explains the margin processing details:

• Table 2-58 Margin processing Details

  Margin Type	Margin	Deal	Expected Processing
  Cash	Pay	REPO / Reverse REPO	Cash margin pay is initiated to pay extra cash. Cash margin account, account branch, account currency and amount details are sent from external system. Cash margin account details will default from reverse repo deal, user can modify the same with proper SSI. SSI are maintained for 'MG' module code for cash margin settlement. The event CMPY is triggered in margin processing screen
  Cash	Receive	REPO / Reverse REPO	Cash margin receive is initiated to receive cash in margin account. The event CMRV is triggered in margin processing screen on cash margin receive
  Securities	Pay	REPO	Securities Pledged - Move to Collateral portfolio Securities pay margin call is initiated to pay additional collateral to the repo counterparty. On securities pay additional collateral is moved from bank portfolio to collateral portfolio by booking a Bank Buy deal (auto-generated BBBS deal). The margin reference number is captured in the SE deal. The event SMPY is triggered in margin processing screen on securities pay.
  			Securities Pledged - Block Securities Securities pay margin call is initiated to pay additional collateral to the repo counterparty. On securities pay, additional collateral is blocked in the bank’s portfolio. If the securities pledged is already blocked, an amendment is created on the block deal to add the additional securities. If the securities pledged is new, then a new block is created on a margin call. Block deal reference and margin reference is captured in a block deal. The same should happen on EOD for the auto liquidated deal. The event SMPY is triggered in margin processing screen on securities pay.
  Securities	Receive	REPO	Securities Pledged - Move to Collateral portfolio Securities receive margin call is initiated to receive pledged collateral from repo counterparty. On securities receive pledged collateral is moved back from collateral portfolio to bank portfolio by booking a bank sell deal (Auto-generated BBBS deal). The event SMRV is triggered in margin processing screen on securities receive.
  			Securities Pledged - Block Securities Securities receive margin call is initiated to receive pledged collateral from repo counterparty. On securities receive block is released partially or fully, and the amendment is created on the block. If the block is fully released block deal will get liquidated. The event SMRV is triggered in margin processing screen on securities receive
  Securities	Pay	Reverse Repo	Securities pay margin call is initiated to pay additional collateral to the repo counterparty. On securities pay pledged securities are moved from collateral portfolio to counterparty custodian by booking a Bank Sell deal (auto-generated BSCB deal). The event SMPY is triggered in margin processing screen.
  Securities	Receive	Reverse Repo	Securities receive margin call is initiated to receive pledged collateral from reverse repo counterparty. On securities receive pledged collateral is moved from counterparty custodian to collateral portfolio by booking a bank buy deal (auto-generated BBCS deal). The event SMRV is triggered in margin processing screen.

Table 2-59 Margin Processing Message Details

Action	DVP/RVP (Yes)	DVP/RVP (No)
Security Pay	MT542	MT542
Security Receive	MT540	MT540
Cash Pay	MT202	MT202
Cash Receive	MT210	MT210