Distributed Collateral Allocation Nodes for Tri-Party Repo Processing
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Solution Overview
Problem
Existing collateral allocation systems face processing delays and inefficiencies in managing Tri-Party Repos, particularly in complex transactions, due to the complexity of collateral management and the need for optimized allocation strategies.
Innovation Solution
A computer-implemented system and method that assigns transactions to computer processing nodes for collateral allocation, using a query to obtain transaction sets, selecting nodes, and applying collateral allocation rules to perform allocations, with nodes transmitting parameter updates to optimize the allocation process.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If collateral allocation is performed using a single processing node, then the system is simpler to manage, but processing delays increase and productivity decreases
Solution Approach 1:
The patent divides the collateral allocation system into multiple independent processing nodes, each capable of handling specific subsets of transactions. This segmentation allows parallel processing of different transaction subsets, thereby increasing overall productivity while maintaining manageable complexity through modular architecture.
Solution Approach 2:
The patent introduces a distributed computing dimension by deploying processing nodes across multiple servers or computing environments. This dimensional expansion from single-node to multi-node architecture enables simultaneous processing of transaction subsets, resolving the contradiction between productivity and complexity.
2Productivity
If multiple computer processing nodes are used to perform collateral allocations, then processing efficiency improves, but system complexity increases
Solution Approach 1:
The system segments the transaction set into distinct subsets, with each processing node assigned to specific subsets. This segmentation strategy increases throughput by enabling parallel processing while controlling complexity through clear division of labor among nodes.
Solution Approach 2:
Each processing node is designed with universal capabilities to handle various collateral allocation rules and transaction types. This multi-functionality allows nodes to be reused across different transaction subsets, increasing overall throughput without proportionally increasing system complexity.
3Speed
If transactions are distributed across multiple processing nodes, then processing speed increases, but coordination overhead increases
Solution Approach 1:
By segmenting transactions into distinct subsets assigned to specific nodes, the system minimizes coordination overhead. Each node processes its assigned subset independently, reducing the need for inter-node communication and coordination while maintaining high processing speed.
Solution Approach 2:
The patent employs an intermediary mechanism (such as a central coordinator or standardized interface layer) that manages communication between processing nodes. This intermediary simplifies coordination by providing a unified interface, allowing nodes to operate in parallel at high speed while coordination overhead remains manageable.
Data Source
AI summary
In certain embodiments, transaction-subset-assignment of computer processing nodes may be facilitated to perform collateral allocation. In some embodiments, a query may be performed to obtain a set of transactions. Computer processing nodes may be selected from a set of available nodes for performing collateral allocations. Collateral allocation rules associated with a lender may be obtained, and each of the computer processing nodes may be caused to perform collateral allocations for one subset of the transaction set in accordance with the collateral allocation rules by assigning transactions of the transaction set respectively to the computer processing nodes such that the computer processing nodes collectively perform collateral allocations for the transaction set. In some embodiments, each of the computer processing nodes may be configured to transmit parameter updates to be provided to the other computer processing nodes and perform its respective collateral allocation based on the other computer processing nodes' parameter updates.