Clearstream and ASX Group in exclusive talks about collateral management cooperation |
| 29 August 2011 Clearstream and ASX have entered in exclusive negotiations to jointly develop a new collateral management offering for the Australian market. The collateral management service for Australia will target the collateralization of exposures in the Australian market managed via ASX. The service will enable ASX clients to handle their collateral holdings and exposures more efficiently, thus strengthening their risk profiles across their trading activities. ASX envisages outsourcing the allocation, optimization and substitution of local collateral – held in the central securities depository Austraclear and CHESS, the settlement system for equities trades – to Clearstream’s proven collateral management infrastructure, the Global Liqudity Hub, that operates on a fully automated basis and in real time. Jeffrey Tessler, CEO Clearstream, said: “Our collateral management service addresses the major industry concern to consolidate and streamline collateral management activities. All users will immediately benefit from future system enhancements in line with market requirements and regulatory demand. We are delighted to partner with ASX, a cooperation that confirms the validity of our collateral management outsourcing model. We will continue to grow this model with a strong partnership approach that incorporates the needs of our strategic partners and their underlying customer base.” Peter Hiom, Deputy CEO of ASX, said: “ASX is working to expand the range of its post-trade services in the Australian market to meet the rapidly changing needs of financial market participants. The large amount of collateral held in ASX depositories presents an opportunity for us to deliver a domestically operated, centralised and fully automated collateral management service. This will allow ASX customers to directly use securities held in CHESS and Austraclear to manage their exposures and to facilitate the funding of their market activity. It will also deliver cost and operational benefits to our customers. As a world leader in the development of collateral management services, Clearstream is a natural partner to assist ASX in bringing this vision to fruition.” Clearstream is the only collateral management services provider in a position to manage collateral across time zones and regions while the assets stay in the respective domestic market, under local legislation – which is a regulatory requirement in many countries. On 18 July 2011, Brazil was the first market to go live with the collateral management outsourcing service. The ongoing development of the Clearstream infrastructure will ensure users are always in line with changing regulations and market behaviors. Collateral is kind of a guarantee that market participants ask for in order to secure exposures resulting from financial transactions. How to most efficiently manage collateral holdings and exposures has become extremely important in times of changing regulatory requirements. The lack of collateral or the demand for more efficient use of existing collateral is a global issue on top of the agenda of many financial institutions. About ASX Group ASX Limited is the listed holding company for a range of licensed operating subsidiaries, together forming the ASX Group, which offer a range of market services linked by a common purpose: to provide the core financial markets services and infrastructure necessary to meet the needs of a wide range of financial markets stakeholders and for a globally competitive and vibrant Australian economy. ASX is a multi-asset class, vertically integrated exchange group, ranked one of the world’s top-10 largest by market capitalisation. Its activities span primary and secondary market services, central counterparty risk transfer, and transaction settlement for both the equities and fixed income markets. ASX functions as a market operator, clearing house, payments system facilitator and central securities depository. It also oversees compliance with its operating rules, promotes standards of corporate governance among Australia’s listed companies and helps to educate retail investors. The domestic and international customer base of ASX is diverse and includes issuers of a variety of listed securities and financial products, investment and trading banks, fund managers, hedge funds, commodity trading advisers, brokers and proprietary traders, market data vendors and retail investors, as well as other listing and trading venues.By providing its systems, processes and services reliably and fairly, ASX seeks to promote confidence in the markets that depend on its infrastructure. This is integral to ASX’s long-term commercial success. More information on ASX can be found at: www.asxgroup.com.au. Media contacts Clearstream Nicolas Nonnenmacher ASX Group Leeanne Bland Matthew Gibbs |
