Triparty collateral management at Euroclear Bank, the international central securities depository of the Euroclear group, has surpassed EUR 300 billion outstanding per day, a new milestone. Growth in this business is exceeding an annual rate of 36% compared with daily levels of EUR 220 billion one year ago.
Olivier Grimonpont, Director and head of Collateral Management and Securities Lending Product Management at Euroclear Bank, said: “Sophisticated collateral-eligibility criteria, recent and planned service improvements, and tariff reductions of more than 45% over the past three years are supporting our clients’ collateral-management needs in the most flexible, risk-averse and cost-competitive manner. Our continued close co-operation with clients, and in particular the Collateral User Group, is helping to ensure that future service developments will sustain our business growth. New collateralmanagement opportunities, such as Euroclear Bank’s soon-to-be released collateral re-use feature, is an excellent example.”
“The interaction between the Collateral User Group and Euroclear Bank is open, frank and productive,” said Grigorios Markouizos, Chairman of the Collateral User Group and Managing Director, European Head of Fixed Income Finance at Citigroup Corporate and Investment Banking. “The dialogue has already resulted in tangible benefits for the market, and we look forward to more,” he continued.
In its capacity as a neutral third-party collateral administrator, in effect, Euroclear Bank in-sources the management of collateral on behalf of its clients to cover exposures arising from repo, securities lending, secured loan and derivatives transactions. Euroclear Bank’s triparty collateral management services optimise the relationship between collateral management and securities settlement by automating the selection and substitution of securities used as collateral throughout the life of each transaction. Encompassing a wide range of securities, the service is used by the world’s most active counterparties and is supported by a solid legal structure in Belgium.
Euroclear is the world’s largest provider of domestic and cross-border settlement and related services for bond, equity and fund transactions. Market owned and market governed, the Euroclear group includes Euroclear Bank, based in Brussels, as well as Euroclear Belgium, Euroclear France, Euroclear Nederland and CRESTCo, the central securities depositories of Belgium, France, the Netherlands, and the UK and Ireland, respectively. The total value of securities transactions settled by the Euroclear group is in excess of EUR 350 trillion per annum, while assets held for clients are valued at more than EUR 15 trillion. Euroclear Bank is rated AA+ by Standard & Poor's and Fitch Ratings.
