Mitigating Risk, Improving Efficiency

Citi and Clear Street Adopt DTCC’s New RMaaS API

By Lauren Richard | Sep 09, 2020

 Citi and Clear Street Adopt DTCC’s New RMaaS API

Earlier this year, DTCC launched the API Marketplace as a new way for clients to directly access DTCC services. The first Application Programing Interface (API) available in the marketplace is DTCC’s Risk Management as a Service (RMaaS) and four NSCC clients, including Citi and Clear Street, are now live with the RMaaS API.


RMaaS provides NSCC clients with firm-specific aggregated data designed to help them monitor risk exposure and gain insight into their current and historical positions. Today, with the availability of the RMaaS API, clients can pull risk data directly into their firms’ own technology. This integration ultimately enables firms to create intelligence with better risk and liquidity management capabilities across functions such as monitoring, surveillance and regulatory compliance.

The RMaaS API became available on July 10 and Clear Street was the first firm to go live in production. Being able to uncover risk data intelligence through a modern API platform was an important benefit for their firm.


“As a prime brokerage, our business runs on timely, accurate information, especially when it comes to risk,” said Chris Pento, Co-Founder and CEO of Clear Street. “We used to compile our projections manually, using data from the DTCC portal. With the RMaaS API, we’ve been able to automate our risk, liquidity, and treasury management projections. Now, we get timely, accurate data anytime we need it -- in seconds.”


Citi was also particularly interested in the new RMaaS API because of the flexibility to embed DTCC’s risk management tools directly into their own proprietary and secured systems.

Transparency Enhancements to RMaaS Empowers Firms to Make Better Decisions

DTCC’s Risk Management as a Service initiative (RMaaS) combines DTCC’s core risk management capabilities to deliver greater transparency into client portfolios across DTCC’s SIFMU businesses.

Responding to member requests, new features have recently been added to the interactive NSCC Risk Client Portal.

One new feature allows member firms to review 15-minute intra-day slices instead hourly, to monitor fluctuations in VaR and exposure. This helps firms anticipate potential intra-day margin calls. NSCC is also extending slices past 4:30pm, until 7:00pm, to allow for a better forecast of next-day risk clearing fund requirements.

To further enhance transparency, in August DTCC also released the detailed algorithm of its VaR formula within the portal, providing the ability for in-house replications of the NSCC VaR formula within clients’ own applications.


“Our internal Payment Systems Risk and Technology teams have partnered with DTCC’s NSCC technology team to implement our very first API connectivity across the two firms,” said Steve Morgan, MD at Citi Global Markets. “NSCC is a major clearing membership for Citi, comprising 60% of our global equity clearing exposure. The new API connectivity enables our risk team to get transparency to exposure earlier than previous practice. Additional benefits include further automation of a number of regulatory reports.”


The flexibility of integrating the RMaaS API with other technologies for faster, automated processes was a major benefit for Citi, but there was also significant focus on the benefits for Citi’s end users.


“We are pleased to have partnered with DTCC on this solution as APIs are helping drive a digital transformation in the financial services industry, making it easier to access information, provide greater levels of flexibility and deliver a superior user experience,” said Greg Fell, Head of Financial Market Infrastructure Risk at Citi.


Support and Documentation

DTCC’s API Marketplace provides clients, partners, dealers, brokers and internal developers with a single, secure, centralized location to access APIs developed by DTCC. The marketplace is organized so internal and external clients can self-select products and access consistent guidance documentation, providing support through the entire API adoption process.


“The RMaaS API provides firms with a powerful insight into their firm-level, aggregated data. They can view their mark-to-market and VaR calculations, which are updated through the day, along with other components to their clearing fund,” said Tim Garrett, Executive Director and Portfolio Manager, Equities Clearing. “We also offer a VaR calculator that firms can use to see the impact of position changes.”


"The API provides access to the same frequency of slices as is available internally and will help firms keep a much closer eye on their requirements,” said Basil Benjamin, DTCC Business Analysis Associate Director. “This enables them to project VaR to avoid unexpected VaR-based margin charges, and better understand pre-trade margin impacts."


For more information about DTCC’s API Marketplace, please visit developer.dtcc.com or talk with us today.

 

 

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