Northern Trust Offers Reporting Solution for Lending Collateral

Northern Trust Corp., a provider of asset-servicing and asset-management solutions, has created a report to assist insurers with regulatory filings on securities lending programs, Schedule DL. The report is designed to provide Northern Trust asset-servicing clients with information formatted to fulfill National Association of Insurance Commissioners (NAIC) reporting requirements for securities-lending reinvestment collateral detail.

"Insurance companies that participate in lending programs as a way to enhance returns on investment portfolios face new regulatory burdens intended to manage risks and enhance transparency," says Sheldon Woldt, head of the Insurance Client segment of Northern Trust's asset servicing business. "As a custodian and securities-lending agent, we are positioned to help our insurance clients fulfill reporting requirements with automated solutions. The Schedule DL report demonstrates Northern Trusts commitment to assisting insurers meet the challenges of changing regulatory requirements."

Northern Trust says Schedule DL, effective Dec. 31, 2010, requires insurance companies to show detailed holdings of reinvested collateral on securities loans. The detail required by the rule typically is not available in insurance investment accounting systems. Northern Trust says its solution combines information from its securities lending database with its insurance investment accounting capabilities to assign Schedule D classifications and NAIC ratings received from the Securities Valuation Office. The data is presented in a format that is compatible with the NAIC-formatted file requirements.

“Without the Schedule DL from Northern Trust, we would need to manually collect collateral reinvestment detail and present it in the statutory annual and quarterly statements in the NAIC required format," says Randy Johnson, senior VP-investments, Texas Mutual Insurance Co. "Northern Trust provides a report that saves us time and makes it easier for us to meet our regulatory reporting requirements."

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Security risk Compliance
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