BOSTON--(BUSINESS WIRE)--State Street Corporation (NYSE: STT), today announced that it has sponsored a record $140 billion in repo investment volumes as a result of its partnership with the Fixed Income Clearing Corporation (FICC). In 2005, State Street partnered with FICC to launch its Sponsoring/Sponsored Member Repo Program, whereby a bank netting member of the clearing house could sponsor eligible US mutual funds to clear their repos with FICC.
With the evolution of the FICC program, and specifically the rule changes in 2017 and 2019 permitting additional sponsoring and sponsored member client types, FICC’s aggregate cleared repo and reverse repo volumes have risen substantially.
As a designated Systemically Important Financial Market Utility (SIFMU), FICC is required to maintain prescribed risk management standards and is subject to heightened regulatory oversight, factors that play a critical role in participants’ assessment of their counterparty risk. US money market funds have been particularly active buy-side participants recently; corporations, hedge funds, insurance companies, and state and local governments are taking notice.
“The growth in sponsored member repo through FICC has been transformational in the actively managed cash marketplace, providing cash investors and cash borrowers critical and stable liquidity,” says Gino Timperio, head of Funding and Collateral Transformation at State Street. “I believe we're in the early stages of a sustained growth trajectory, from which our clients and the overall market will continue to benefit.”
“UBS was an early adopter of Sponsored Repo [with State Street],” says Rob Sabatino, Head of Liquidity Investments at UBS Asset Management. “The growth of sponsored repo volumes within FICC highlights demand from both cash investors and borrowers for a highly efficient, centrally cleared solution and I anticipate the next wave of growth will be from corporations, local government investment pools, and offshore entities managing US dollars.”
State Street continues to work closely with the FICC and other central clearing counterparties to expand the eligibility of cleared collateral options, jurisdictions and tenors, to further support clients’ liquidity and financing needs.
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's leading providers of financial services to institutional investors, including investment servicing, investment management and investment research and trading. With $32,754 billion in assets under custody and administration and $2,918 billion* in assets under management as of June 30, 2019, State Street operates globally in more than 100 geographic markets and employs approximately 40,000 worldwide. For more information, visit State Street's website at www.statestreet.com.
* Assets under management include the assets of the SPDR® Gold ETF and the SPDR® Long Dollar Gold Trust ETF (approximately $36 billion as of June 30, 2019), for which State Street Global Advisors Funds Distributors, LLC (SSGA FD) serves as marketing agent; SSGA FD and State Street Global Advisors are affiliated.
State Street Corporation One Lincoln Street, Boston, MA 02111-2900.
The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without State Street’s express written consent.
© 2019 State Street Corporation - All Rights Reserved
Expiration Date: 8/31/2020