Deutsche Börse: Frankfurt Stock Exchange Enables Securities Settlement Via Further Sammelbanken - Deutsche Börse Group In Favor Of Opening Up Settlement Systems

The Frankfurt Stock Exchange (FWB Frankfurter Wertpapierbörse) has amended a provision in the Exchange Rules that required equities transactions to be settled through the central securities depository, Clearstream. As a result, exchange transactions can now be settled through any duly registered Wertpapiersammelbank in the Federal Republic of Germany. The change was announced by Deutsche Börse AG, the company that operates the Frankfurt Stock Exchange, after the Exchange Council of the Frankfurt Stock Exchange approved the amendment.

The new Frankfurt Stock Exchange rule lifts the exclusive status historically enjoyed by the national securities clearer, which has effectively existed in most European markets to date. Wertpapiersammelbanken are specialized banks that administer securities in collective safe custody and carry out securities giro transactions, thus enabling the non-physical delivery of securities in settlement of on- and off-exchange securities transactions; such banks are registered by the competent authorities of the respective German federal states (Länder) on the basis of the German Safe Custody Act.

The Deutsche Börse Group has always been in favor of opening up the settlement systems, especially in order to increase the efficiency of cross-border securities settlement in the interest of the market as a whole. At the same time, in the Group's view, opening up the settlement systems Europe-wide, which allows mutual access, holds additional business potential in settlement.

In November 2003, Clearstream, in association with the Deutsche Bundesbank and several other central banks in the EU, had developed the concept for a European clearing and settlement standard. The "guarantee concept" simplifies the cross-border settlement of securities and lowers the costs for participants. Trading firms from participating countries can use central bank liquidity at their home central bank to secure securities transactions in Germany, giving them access with a level of efficiency comparable to that of domestic participants.