New York/London/Hong Kong/Singapore/Sydney, September 3, 2025 ‒ The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, today announced that its Fixed Income Clearing Corporation (FICC) subsidiary has formally filed with the SEC a rule filing to enhance FICC’s Sponsored Service with a new cleared tri-party offering known as the Sponsored General Collateral (GC) “Collateral-in-Lieu” service. The filing is expected to be published in the Federal Register soon, which will begin a public comment period.
This innovative new enhancement is designed to solve for critical industry concerns regarding the need for enhanced margin and capital efficiency to ensure a smooth implementation of the U.S. Treasury Clearing mandate. The proposed service is uniquely designed to leverage the haircut typically posted by dealers to money market funds and other cash investors in tri-party via a CCP lien that is applied “in lieu” of both a Sponsor guaranty of client performance and the posting of margin to the CCP (in most circumstances), thereby solving for the so-called “double-margining” challenge. This challenge is created because Sponsors typically post haircuts to money market funds to satisfy overcollateralization requirements as well as post CCP margin on their behalf.
“The Sponsored Service has been an incredibly popular buyside clearing solution, with over $2T in volume flowing through the Service on a typical day,” stated Laura Klimpel, Managing Director, Head of DTCC’s Fixed Income and Financing Solutions. “The proposed Collateral-in-Lieu service has been intentionally designed to build upon that success and allow Sponsors and their clients to leverage many of their existing legal agreements and operational processes for Sponsored repo, but take the margin and capital efficiencies of the product to the next level. We welcome SEC and public input as we advance this important initiative.”
The Collateral-in-Lieu service would be offered by FICC leveraging BNY’s tri-party infrastructure to support the collateral management and settlement of the Collateral-in-Lieu repo trades, with both “done-away” and “done-with” styles of trade execution to be supported in the service.
“The FICC’s Sponsored GC Collateral-in-Lieu service is precisely the type of solution the industry needs to meet the SEC’s central clearing rule in a capital- and margin-efficient way,” said Nate Wuerffel, BNY’s Global Head of Market Structure and Product Leader for the Global Collateral Platform. “Built using BNY’s global collateral platform—the largest Treasury tri-party repo settlement venue—Collateral-in-Lieu offers Treasury market participants streamlined, efficient access to central clearing.”
FICC aims to launch the Collateral-in-Lieu service in December 2025, subject to regulatory approval of the filing.
ABOUT DTCC
With over 50 years of experience, DTCC is the premier post-trade market infrastructure for the global financial services industry. From 20 locations around the world, DTCC, through its subsidiaries, automates, centralizes, and standardizes the processing of financial transactions, mitigating risk, increasing transparency, enhancing performance and driving efficiency for thousands of broker/dealers, custodian banks and asset managers. Industry owned and governed, the firm innovates purposefully, simplifying the complexities of clearing, settlement, asset servicing, transaction processing, trade reporting and data services across asset classes, bringing enhanced resilience and soundness to existing financial markets while advancing the digital asset ecosystem. In 2024, DTCC’s subsidiaries processed securities transactions valued at U.S. $3.7 quadrillion and its depository subsidiary provided custody and asset servicing for securities issues from over 150 countries and territories valued at U.S. $99 trillion. DTCC’s Global Trade Repository service, through locally registered, licensed, or approved trade repositories, processes more than 25 billion messages annually. To learn more, please visit us at www.dtcc.com or connect with us on LinkedIn, X, YouTube, Facebook and Instagram.
ABOUT BNY
BNY is a global financial services company that helps make money work for the world – managing it, moving it and keeping it safe. For more than 240 years BNY has partnered alongside clients, putting its expertise and platforms to work to help them achieve their ambitions. Today BNY helps over 90% of Fortune 100 companies and nearly all the top 100 banks globally access the money they need. BNY supports governments in funding local projects and works with over 90% of the top 100 pension plans to safeguard investments for millions of individuals, and so much more. As of June 30, 2025, BNY oversees $55.8 trillion in assets under custody and/or administration. BNY Investments is part of BNY and is one of the world’s largest asset managers with over $2.1 trillion in assets under management, offering investment solutions across every major asset class to the institutions and intermediaries it serves.
BNY is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Headquartered in New York City, BNY has been named among Fortune’s World’s Most Admired Companies and Fast Company’s Best Workplaces for Innovators. Additional information is available on www.bny.com. Follow on LinkedIn or visit the BNY Newsroom for the latest company news.