Collateral Component

Field 4.07 | Matching Date: n/a | Tolerance: n/a>

Status: Best Practice Finalised, Last Updated: 18/08/2021

Field 4.07 | Matching Date: n/a | Tolerance: n/a

Description:
Identification of the security used as collateral.

Best Practice:
If Field 4.6 (Type of Collateral Component) is populated with "SECU" this field shall be populated and shall contain an ISIN (x12 alphanumerical characters and a check digit), else leave blank.

If the collateral has no ISIN due to a corporate event, or for any other reason such as private placement, participants should send what they have (whether a temporary ISIN or leave the field blank) until the ISIN is established.

With regards to missing ISINs; see Guidelines on reporting under Articles 4 and 12 SFTR 06 January 2020 - ESMA70-151-2703 :

332. While ESMA acknowledges that there may be cases where securities used as collateral might be issued by issuers that are not subject to the EU rules obliging them to obtain LEIs, and that similarly there may be instances in which a security cannot be identified with an ISIN, ESMA reiterates the importance of a correct identification of the issuer and issuance through the LEI and the ISIN in the context of SFTR reporting.

There is nothing in these statements that makes this optional.

No change to original guidance for current April 2020 go-live, either supply blank or dummy, each individual member firm to decide. Issue of reporting dual ISINs also being considered. (SFTR-126)