BNP Paribas Securities Services, which is custodian for over US$8 trillion (€6 trillion) in assets, and Euroclear Bank, an international central securities depository (CSD) which safe-keeps clients’ assets worth over US$ 33 trillion (€24 trillion), are extending their joint triparty collateral management service introduced last year in Italy and Spain to four new capital markets: Belgium, France, Germany and the Netherlands.
The service is already used by a number of investment banks and brokers.
The partners said that their collaboration enables mutual sell-side clients to seamlessly optimise equities and fixed-income securities collateral held in both companies’ books in these six domestic markets for use in triparty transactions managed by Euroclear Bank. The securities can be returned to clients’ domestic accounts as and when required.
“Our partnership with BNP Paribas, which now spans six European capital markets, is part of the on-going extension of the collateral highway to more markets globally,” said Frederic Hannequart, chairman of Euroclear Bank.
“The unique technology used allows for the automatic and friction-free mobilisation of both fixed income and equities collateral at a lower cost than other cross-border triparty collateral providers. Our joint customers can now take a holistic approach to collateral management and this service affords them the highest levels of cost and risk efficiencies when sourcing and allocating securities.”
Alain Pochet, head of clearing, custody and settlement at BNP Paribas Securities Services, added: “Our collateral access – connect service, which enables us to establish links with institutions such as Euroclear Bank while keeping our clients’ assets segregated, is an excellent example of how the industry can work together to help customers access collateral easily and efficiently.”
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