OCC and eSecLending Create Liquidity Facility with CalPERS March 2015
CHICAGO and BOSTON (March 10, 2015) – The Options Clearing Corporation (OCC) and eSecLending announced today that they collaborated with CalPERS to develop a product to help OCC diversify and increase their committed liquidity resources while offering a compelling risk-adjusted return for CalPERS. The fully collateralized facility offers the OCC, the world’s largest equity derivatives clearing organization, a source of timely access to liquidity while maintaining CalPERS’ conservative risk profile.
“CalPERS conducted an extensive due diligence process on the facility and are delighted to have established a solution that achieves incremental risk-adjusted returns for our pensioners,” said Curtis Ishii, Head of Global Fixed Income at CalPERS.
“The diversification of OCC’s committed lenders to include CalPERS in addition to our existing base of banks and broker-dealers ensures that sufficient capacity is maintained at all times, which is critical to central counterparties like OCC,” said Craig Donohue, OCC Executive Chairman. “Expanding our liquidity resource pool to draw on non-bank facilities allows OCC to meet payment obligations to clearing members in a timely way, thus promoting the uninterrupted flow of financial markets,” he said.
eSecLending is the administrative agent for the facility and supports CalPERS with all aspects of the transaction. “We are proud to have expanded our product offering to CalPERS and to help the OCC diversify and increase their committed liquidity resources. The collateralized facility offers CalPERS an attractive yield within a tightly controlled operating environment and addresses the OCC’s desire to establish right way risk in their funding sources,” said Chris Poikonen, Executive Vice President at eSecLending.
CalPERS is the largest public pension fund in the U.S., with approximately $300 billion in assets. CalPERS administers health and retirement benefits on behalf of 3,090 public school, local agency, and state employers. There are more than 1.6 million members in the CalPERS retirement system and more than 1.3 million in its health plans. For more information about CalPERS, visit www.CalPERS.ca.gov.
OCC is the world’s largest equity derivatives clearing organization. Founded in 1973, OCC operates under the jurisdiction of both the Securities and Exchange Commission (SEC) as a Registered Clearing Agency and the Commodity Futures Trading Commission (CFTC) as a Derivatives Clearing Organization. OCC now provides central counterparty (CCP) clearing and settlement services to 16 exchanges and trading platforms for options, financial futures, security futures and securities lending transactions. More information about OCC is available at www.theocc.com.
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eSecLending is an independently owned financial services company providing securities financing, collateral and liquidity services, and default management solutions to institutional investors, and clearing organizations worldwide.
eSecLending’s operating company (the company through which substantially all eSecLending transactions are contractually executed) is Securities Finance Trust Company (“SFTC”). SFTC is an independent trust company incorporated in the state of Vermont and subject to examination and regulation by the Vermont Department of Financial Regulation in accordance with the rules and regulations of the Office of the Comptroller of the Currency of the United States.
eSecLending is headquartered in Boston and has offices in London, England and Burlington, Vermont. The company was founded in 2000 and is currently owned by Parthenon Capital Partners, a private equity firm based in Boston and San Francisco.