Bear Stearns Fixed Income Prime Brokerage offers comprehensive clearing, operations and funding solutions to clients around the world.

This group's expertise covers a broad range of global fixed income instruments, including government, corporate and mortgage-backed securities. Services include clearing, processing and trading capabilities in futures, foreign exchange and derivatives transactions. These services are fully integrated with the firm's prime brokerage offerings, which are managed globally by professionals with extensive industry experience.

Over the past two decades, the Fixed Income Prime Brokerage Group has served the growing needs of a diverse client base:

  • Banks and proprietary trading desks
  • Broker-dealers
  • Hedge funds
  • Institutional investors
  • Insurance companies
  • Portfolio managers and other professional investors
  • Real estate investment trusts (REITs)
Infrastructure
The business of fixed income clearing is extremely demanding, involving many markets and settlement conventions across multiple products. Bear Stearns processes complex strategies and back-office records must be managed day-in and day-out for hundreds of clients, all of whom have different investment strategies and risk parameters. Over the past two decades, Bear Stearns Fixed Income Prime Brokerage has built an infrastructure and technology platform that can manage the fixed income clearing needs for clients, now and in the future.

Instruments are cleared through the firm's automated links to the Federal Reserve Bank Securities Transfer System and the Depository Trust & Clearing Corporation (DTCC), or through direct clearing accounts at Euroclear and Clearstream International. The group also clears transactions through network interface with domestic settlement systems.

State-of-the-art systems provide operational and settlement efficiencies. Experienced professionals help clients track, control and reconcile trading activity, repurchase (repo) and reverse repo activity and real-time cash.

Variety of Fixed Income Products
Bear Stearns Fixed Income Prime Brokerage provides clearing, processing and financing services for fixed income products in more than 65 countries. The broad range of product coverage includes:

  • Mortgage-backed securities
    • Bear Stearns has consistently ranked as one of the financial industry's leading mortgage securities dealers over the last 10 years. As a major participant in this market, Bear Stearns gives clients access to a fully integrated link to the Mortgage-Backed Securities Division (MBSD) of the Fixed Income Clearing Corporation (FICC). Bear Stearns offers post-trade comparison, netting and pool notification services for clients' mortgage-backed portfolios. Also available are full allocation services, including pool optimization based on trader-defined criteria, pool screening to identify and segregate more valuable "seasoned" securities, and positive fail maximization. Bear Stearns' Electronic Pool Notification (EPN) System, which quickly and reliably communicates pool information on 48-hour notification days, supports client accounts.
  • US government and agency debt
    • As a primary dealer in U.S. Treasury securities, Bear Stearns is an active participant in the Government Securities Division (GSD) of the FICC for comparison and netting services for trades and funding transactions, and makes certain related services available to clients. MBSD and GSD are designed to help reduce the costs and risks associated with trading in their respective markets. Both entities offer product-specific services to members, with each maintaining separate rules and a separate securities margin pool.
  • Asset-backed securities
    • Leveraging off of the operational infrastructure that supports our proprietary desks, Bear Stearns offers prime brokerage clients clearing, processing and settlement services for a full range of US and Non-US structured products from traditional asset-backed securities to more esoteric CDOs.
  • Investment grade & high yield corporate bonds
    • Through our Prime Brokerage platform Bear Stearns clears, processes and settles corporate bonds throughout the capital structure. Additionally, we offer clients the flexibility to finance these positions through traditional margin loans or via the repo market.
  • Sovereign bonds & emerging market securities
    • Bear Stearns Fixed Income Prime Brokerage can provide clearing, processing and settlement services for sovereign and corporate debt in more than 65 countries.

Financing Through Bear Stearns and Other Counterparties
Through its Fixed Income Finance Desk, Bear Stearns provides its clients with competitive and flexible funding solutions that can be designed to meet the client’s individual funding requirements. Fixed Income Prime Brokerage clients are encouraged to fund their positions through other dealers as well as with Bear Stearns. Bear Stearns then simply requires details about the positions funded by other firms on or before the settlement date to process the delivery and return of the securities. Clients receive the same level of settlement processing, clearing, and centralized, real-time reporting for all of their financing activity, whether trades are financed with Bear Stearns as principal or with other dealers.

OTC Derivatives Trade Servicing and Intermediation
Bear Stearns OTC Derivatives Trade Servicing (DerivClear) provides operational support to clients and their counterparties involved in the over-the-counter (OTC) derivatives market, and covers a wide range of derivatives products, including credit, equity and fixed income instruments. DerivClear consolidates the operational components of an OTC derivatives portfolio into a single view and minimizes many of the administrative tasks associated with derivatives processing. Online database queries and other services can be customized to meet the specific needs of clients. Key features provide solutions for credit support, trade capture, confirmation and settlement.

Through our credit intermediation offering, clients have the ability to execute derivatives transactions with multiple counterparties while Bear Stearns acts as the sole counterparty for margin, settlements and confirmations. By having a single ISDA with Bear Stearns, the administrative and operational burden of trading across the street is greatly reduced.

Technology
BearPrime, our web-based technology interface for prime brokerage clients, provides a secure portal to diverse reporting and real-time account information. Some of the differentiating aspects of the platform include:

  • Real-time position and activity information
  • Real-time cash management for current and future dates
  • TBA comparison, netting, and same day allocations results
  • Real-time P&I projections integrated with real-time cash management
  • Consolidated tracking of buy, sell, and financing trades executed with any counterparty
  • Income collection on financing transactions executed away from Bear Stearns
  • Risk, equity, and financing exposure reporting

DerivClear, Bear Stearns’ web based derivatives trade processing system, services a broad range of fixed income, equity and credit OTC derivative products. Backed by powerful browser-based Java technology, our application consolidates the operational components of your OTC derivatives portfolio into a single view. Client positions, activity, counterparty credit profiles, and margin servicing information are available real-time through this website.