New Agency Clearing, Collateral and Execution Unit at J.P. Morgan

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J.P. Morgan recently announced the integration of its Worldwide Securities Services (WSS) collateral management and clearing services with futures and options, OTC clearing and other equity clearing-related activities within the Investment Bank for the creation of a new agency clearing, collateral and execution joint venture. The new unit will operate under the leadership of Emily Portney, current global head of the futures and options business, who has been with the firm since 1993. Thought spoke with Ms. Portney about the announcement and some details of the new structure.

Thought
What prompted this integration effort?

Emily Portney
The regulatory environment and the needs of our clients. As regulatory reform and innovation continue to drive significant change across agency execution, clearing and collateral management, we decided to increase coordination among these functions. We are integrating our internal teams so that it's much more seamless and primed to develop innovative solutions that span the franchise.

Thought
How will clients benefit from this centralized structure?

Emily Portney
J.P. Morgan has market-leading capabilities in each of these areas. One centralized unit will help ensure that we are well coordinated in the development of end-to-end client solutions in clearance, collateral and execution, regardless of whether our clients are active in swaps, futures or securities. We are providing clients with the option to benefit from a holistic approach or to continue to choose services a la carte.

Thought
Does your new unit play a role in market making activity?

Emily Portney
No. Clearing, collateral and execution are all agency functions distinct from J.P. Morgan's market making activities, which sit in a different part of our Investment Bank. The existing separations and "Chinese walls" remain in place to ensure that institutional information is held securely and not shared between the businesses.

J.P. Morgan's new unit will continue to offer these services globally to pension funds, insurance companies, asset managers, corporates, sovereign wealth funds, central counterparties, sell-side firms and banks/broker dealers.

Emily Portney
Global Head of Agency Clearing, Collateral Management and Execution

Thought, Fall 2012

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