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HDFC Bank adopts Bloomberg MARS SIMM to comply with Uncleared Margin Rules

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Bloomberg announced that HDFC Bank, India’s largest private sector bank, has adopted the Bloomberg MARS SIMM solution to calculate initial margin requirements for non-centrally cleared derivatives and ensure compliance with the Uncleared Margin Rules (UMR). The Bank is already using Bloomberg’s Multi-Asset Risk System (MARS) to support its transition to risk-free rates (RFR).

This margin solution covers single-security, portfolio, and collateral management workflows, supported by a powerful suite of derivatives functionality on the Bloomberg Terminal, including Bloomberg’s MARS. Bloomberg has implemented the SIMM methodology in line with ISDA SIMM Methodology guidelines.

With the deadline of September 2022 for the ‘Phase VI Uncleared Margin Rule’ approaching, HDFC Bank will be able to utilize the Bloomberg SIMM solution to monitor the initial margin requirements effectively. MARS SIMM comes integrated with live market data and provides the end-of-day SIMM numbers, intra-day or pre-trade analytics, and back-testing.

In addition, Bloomberg recently announced the expansion of its post-trade integration with Acadia to include pre-trade data. The integration between MARS SIMM and Acadia’s IMEM (Initial Margin Exposure Manager) module for SIMM enables clients to run pre-trade analytics through MARS SIMM using Acadia’s IMEM CRIF data capabilities.

“HDFC Bank has always been very proactive in ensuring regulatory compliance with the best possible solutions. Bloomberg’s SIMM Solution with us provides access to margin calculations, legal entity and agreement data, inventory, reconciliations, risk analytics, and other relevant information. The functionality and data integration capabilities will help maximize workflow efficiency and reduce operational and credit risk,’’ said Bhaskar Panda, Executive Vice President, Overseas Treasury, HDFC Bank.

“We are focused on providing our clients with enhanced risk management tools and functionality through Bloomberg MARS that optimize their workflows while helping them comply with regulatory requirements. Our award-winning SIMM solution seamlessly integrates with live market data to provide our clients with reliable margin analytics and ensure regulatory compliance,” said Dharrini Bala Gadiyaram, Global Head of Risk Products, Bloomberg.

MARS SIMM is accessed through Bloomberg’s Multi-Asset Risk System (MARS), a comprehensive suite of risk management solutions. MARS, which is delivered on the Bloomberg Terminal and via APIs, provides risk analytics for cash and derivatives securities, from vanilla to complex and cash-structured products. Bloomberg Risk solutions cover all traders’ and portfolio managers’ front-office needs across market risk, XVA, credit risk, collateral, and SIMM among others, which are built on a common pricing library to provide consistency across client workflows.

MARS SIMM is part of Bloomberg’s suite of Collateral Management solutions which was awarded, the ‘Best Collateral Management and Optimisation’ product from Risk.net in 2020. Bloomberg was also awarded ‘Best Pricing and Risk Analytics Provider’ at the Structured Retail Products Asia-Pacific Awards in 2021. At the Risk Awards, 2022, Bloomberg won the ‘Technology Vendor of the Year

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