Triparty repo

Launched in 1992, our triparty repo service enables clients to benefit from various sources of funding, combined with outsourced settlement and administrative functions as well as value-added services.

While cash providers have traditionally included central banks, sovereign institutions, commercial and supranational banks, triparty repos are also becoming increasingly attractive for buy side clients such as corporates, hedge funds and asset managers. They tend to favour triparty repos over more conventional money market instruments and bilateral repos because of their unique risk-return mix, combining a high degree of safety with additional yield pick-ups. Clearstream acts as a neutral triparty agent for both parties and offers a full range of services from trade opening to closing.

One of the reasons the buy side is increasingly using triparty repos is the reduction of the administrative burden previously associated with repos. In the past, clients had to sign many bilateral agreements with different counterparties. Clearstream has greatly simplified this process through a new legal master agreement for triparty repo transactions called the Clearstream Repurchase Conditions (CRC). The CRC gives the buy side instant access to a wide range of counterparties that have also signed under the same agreement. The job of the corporate treasurer is further simplified through a wide range of standardised collateral baskets that make it easy to get started in triparty repo.

To give corporate clients access to its services, Clearstream has also partnered with 360T, a multi-bank, multi-asset platform based in Germany which enables 360T’s corporate and institutional clients to trade triparty repos with a range of banks on the platform. Once the trade is agreed, it is routed automatically to Clearstream’s collateral management engine, with straight-through processing.

Clearstream offers a similar connectivity solution with Bloomberg's Professional service which enables straight-through processing of triparty repo transactions by supporting communications between market participants and buy side clients.

Cash providers in a triparty repo benefit from full collateral reuse: for example, they can use the securities received to cover CCP margin requirements in derivative obligations.