Using automated messaging via SWIFT, on a daily basis, MUTB will reconcile positions, distributions, corporate actions, and payments against BBH’s custody records.
Growth is in the details
Securities lending can generate additional revenue and improve fund performance, creating lasting value across your portfolio. But success depends on precise execution, combining the right mix of trading expertise, transparency, and risk management.
BBH has entered into an arrangement with Mitsubishi UFJ Trust and Banking Corporation (MUTB) under which MUTB will provide BBH clients with a sophisticated securities lending product offering, including expanded market coverage, trading opportunities, collateral flexibility, a comprehensive list of eligible borrowers, and industry-leading indemnification delivered by Japan’s largest banking group, MUTB’s parent company, Mitsubishi UFJ Financial Group (“MUFG”). Like BBH, MUTB is highly focused on delivering an optimal client experience through a model that integrates workflows, servicing, and support.
A BBH Securities Lending Partner team, responsible for coordination between BBH and MUTB, will seek to ensure seamless integration in the delivery of custody and securities lending services for BBH clients to optimize outcomes.
Benefits of an industry leading Securities Lending program offered through a BBH and MUTB collaboration
MUTB’s parent company, Mitsubishi UFJ Financial Group (“MUFG”) is Japan’s largest banking group and 7th largest bank in the world (USD 3 trillion in assets).
(Ratings: Moody’s: A1, P-1; S&P: A, A-1).
MUTB’s portfolio of lendable securities exceeds $1.2 trillion; there are more than $100 billion in outstanding transactions across 34 markets, and 120 approved counterparties/borrowers.
Indemnification, provided by MUFG, against counterparty insolvency risk (“margin shortfall risk”) with respect to loans of securities and all acceptable collateral types.
Specials: Traders employ a daily auction-like trading process to solicit bids from firms that originate demand.
General Collateral: Automated queuing is used to allocate loans on a fair and equitable basis.
Structured: Traders proactively interface with borrowers to capture demand that best suits today’s capital regulations.
Centralized intraday clearing model enhances on-loan performance, reduces settlement risk, and simplifies custodial support. MUTB’s middle office team are co-located with the front office team for greater efficiency and response times.
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