Collateral Management

A case study of enterprise application designed for managing movement of assets and ensuring transparency.

8 min readSep 9, 2018

To comply with non-disclosure agreement, I have omitted the confidential information in this case study including the branding and colors.All information in this case study is my own and does not necessarily reflect the views of BNY Mellon.

Regulation — it’s having a ripple effect throughout the financial markets and changing the way you do business. One change having a significant impact on the financial markets is the growing need for collateral in financial transactions.

Not too long ago, there were only a handful of transaction types that required institutional investors to post collateral, and the processes for posting collateral were not highly regulated or uniform throughout the world’s financial markets. Institutional investors didn’t always have a full understanding of who their counterparties were or where their collateral was being held. Then the financial crisis hit in 2008. Large institutions defaulted and some went bankrupt, and some assets that were linked to financial transactions could not be recovered. Certain counterparties who had posted collateral struggled to obtain the collateral due to them. After the crisis, regulators and policy makers stepped in to create new rules and reforms in an effort to reduce risk in the financial markets.

Reference: BNY Mellon

The Challenge

Few years down the line, the Collateral Portal evolved with numerous iteration with the functionalities and customization with changes in technology advancements and growing business requirements. Though efforts were made to incorporate changes but scalability, consistency, and changing user needs went for a toss. As a result, the software became complex to use, costly to support and nowhere near modern web standard. In 2016, an effort was made by UX team to redesign the interface. We kick start this effort by setting high level goals:

What was my role? — I collaborated with one of the senior designers to ideate and redesign the interface. I was primarily working on Wireframes, Prototypes and was involved in decoding the research done by Senior UX Designer. I received huge help from Visual Designers and Information Architects within the UX Team. In the process, I worked together with Business Analysts, Developers and Business Product Manager. The whole effort took nearly five months and the MVP was launched in early 2017.

Process

Empathy

We followed the Design Thinking process where the first phase was to empathize with the users. We went on to conduct Contextual Inquiry sessions with our business users as well the Product owner. It was also important to get the domain knowledge and understand terms like Collateral, Segregation, Segregated Accounts etc. Business Analysts and our secondary research helped us lot in understanding the business better. Since we were redesigning an existing application, we also paid attention towards the existing interface and ran Heuristic Evaluation within the team. Talking to one of developers who was part of the team which designed this application earlier, he told us that “The application looks simple from outset but it becomes very complex when you dig deep into it”. So was the case, after conducting contextual inquiry, we were amazed by the complexity of the system and the number of issues with which application was delivering the experience.Below were the research findings.

1Usability Issues: There were lot of usability issues — like navigation, layout, even the typography. Users were so busy performing their task that it became a routine for them to use this application the way it is and as a result they did not even notice these issues anymore.

2Non-Responsive Design: The application interface was not responsive and was missing out the growing needs of customers who were using tablet and mobile for business.

3Modern Design: The application interface was never inline with the modern web standards. It was important to redesign the interface by following organization’s UI standards.

Define

It was important to know user and business goals before moving further.We continued the process by defining high level user and business goals. The Agile UX method was best suited for such massive time bound project. As we concluded our primary research, we jotted down the user stories as well. They were then prioritized and validated with product managers for a particular sprint later on.

We identified three key user types: Collateral Provider , Collateral Receiver and BNY Mellon Executive.

User Goal: To perform the task quickly and easily without making them think much.

Business Goal: Secure and transparent asset movement with better system performance.

User Stories Format: As a [user/persona], I would like to [low-level task], so that [high-level goal]. For example, As an BNY Mellon Executive, I would like to move assets from Custody Account to Segregated Account, so that I can create a pledge.

Reframing The Problem : How might we empower investors, counterparties, and Intermediate Bank to manage movement of assets safely and with transparency by providing consistent and seamless user experience?

Ideate

During this phase, lot of brainstorming sessions happened and I collaborated with the senior designer to work around ideas. I came with some paper prototypes first and validated the same with senior designer when needed.We also made few assumptions when required, which were validated later on with stakeholders.

Prototype and Test

Collateral Portal Redesign — Seg UI

I worked on wireframes and prototype to design an application which canhelp users to execute the movement of assets easily and safely. I used tools like Balsamiq and Axure RP to transform our ideas into design. Also took help from Visual designers to deliver the final product.

Agile Sprints: We followed Agile UX methodology. The Agile UX method was best suited for such massive time bound project.While running an agile sprint we made sure that the design sprint is always ahead of development sprint.

Information Architecture : The page layouts, navigation, and taxonomy were designed with emphasis on consistency, scalability, and responsiveness of elements.

I worked with the ‘Information Architecture’ team to integrate this application alongside a suite of applications and services on the new platform. A special care had to be taken to integrate the application to maintain scalability of the overall information architecture.

Pledge: The page hosts an interactive grid listing securities(based on account) under the selected Legal Entity.This grid allows users to scan, analyze, compare, filter, sort, and manipulate information to derive insights and perform necessary actions. The main purpose of the user coming to this screen is to move the assets from Custody Account to Segregated Account.

Quick Review under Pledge/Receive: On both Pledge and Receive screens there is a quick review accordian which is expandable and collapsible. The reason behind having accordian is that sometimes the table content is huge and user have to scroll a lot, so before the final call to action (Verify), the user can have quick review of what all is done so far. This can avoid lot of scroll, which saves lot of time. The user can even delete any entry.

Quick Review Collapsed and Expanded (see the bottom component)

Receive: The page hosts an interactive grid listing securities(based on Segregated account) under the selected the Legal Entity.This grid allows users to scan, analyze, compare, filter, sort, and manipulate information to derive insights and perform necessary actions. The main purpose of the user coming to this screen is to move the asset from Segregated Account to Custody Account.

Verify Pledge/Receive: The purpose of this screen was to allow user to verify the transaction before final submission. In case user is not satisfied with the entries, they can either delete each entry or can go cancel the verification process. The main purpose of this screen is to avoid any mistakes and help user read all the entries before final submission.

Collateral Overview Screen: The purpose of this screen was to allow user to see where and how their assets are placed currently. How much assets are pledged or how much assets are available, all these questions were answered here.Data visualizations helps the user to view complex data in easier way.

Mobile Version: This is a responsive application, so a well thought out and structured mobile interface was also designed.

Prototype Link: https://qkoeqy.axshare.com

Information Architecture: I collaborated with the taxonomy team and after couple sessions with the taxonomy and business team, we went to structure the information architecture.

Deliver

After nearly 5 months of efforts, the MVP was launched in Feb 2017. We received great response from stakeholders.We never stopped taking feedback and kept on iterating when needed. The development and business team realized the value of user centered design process, and was pushing hard towards the common goal. It was a huge win.

ROI

After all the efforts, all eyes were on Return on Investment. The interface was already received well by Product Owners and users. Collateral Management is part of Asset Servicing LOB and the 3rd quarter reports in 2017 says “ Asset servicing fees increased 4% year-over-year and 2% sequentially. The year-over-year increase primarily reflects higher equity market values and net new business, including growth in collateral management”. This means that there was total 20 million US dollars increase (quarterly) in revenue under asset servicing and collateral management had a role to play in it.

Learnings

This project turned out be my first project. I was nervous and excited at the same time in the beginning. Since I was working alone most of the time with a little guidance and assistance from my senior designer,many a times it was self learning.I learned to integrate business, technology, and time constraints in my design. I learned to collaborate with developers and business. It was an amazing experience.

I hope that you enjoyed reading the case study as much as I enjoyed putting it together.

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