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The Euroclear Boards have agreed to the largest -ever series of fee reductions in Euroclear Bank’s history. An unprecedented EUR 78 million in annualised tariff reductions will be shared with clients in 2007. In addition, Euroclear Bank clients will receive EUR 45 million in tariff rebates in early 2007 proportioned to the amount of safekeeping, settlement and securities-lending business they have placed with Euroclear Bank in 2006.
Starting in January 2007, a large part of the EUR 78 million in fee reductions will apply to safekeeping fees for Eurobonds and German debt securities (‘Bunds’). Greater sliding-scale volume discounts will also be implemented across Euroclear Bank’s safekeeping services, enabling clients to benefit from further discounts as they hold more of their securities positions with Euroclear Bank from their different locations and subsidiaries that may be doing business elsewhere.
Euroclear Bank fees for triparty collateral management services will be reduced by more than EUR 8 million as of February 2007. At that time, the settlement fee will be eliminated for client use of Euroclear Bank’s automated collateral allocation and monitoring system – AutoSelect(™ )- which is used by 98% of Euroclear Bank’s triparty-service clients.
Martine Dinne, Chief Executive Officer of Euroclear Bank, commented:
“We
are ending the year in a very strong financial condition, having won significant
new client business and processing a record level of transactions from existing
clients. We are pleased to be in a position to deliver EUR 120 million in
savings to clients now, and incrementally over the next few years by sharing
the benefits of platform consolidation and market-practice harmonisation.
We are confident that the tariffs we will publish publicly in the new year, in
compliance with Commissioner McCreevy’s Code of Conduct on clearing
and settlement, will further reinforce Euroclear Bank’s competitive appeal.”
In 2005 and 2006 combined, Euroclear Bank distributed EUR 90 million in rebates and more than EUR 68 million in tariff reductions across multiple services and products. Taking into account rebates, tariff reductions and changes in sliding-scale tariff discounts, from 2005 through 2007, Euroclear Bank will have delivered approximately EUR 280 million in savings to clients.
Euroclear Bank provides settlement and related securities services for cross-border transactions involving domestic and international bonds, equities and investment funds. Serving major financial institutions located in more than 80 countries, Euroclear Bank is based in Brussels and is part of the Euroclear group of companies. The Euroclear group also includes 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.
Euroclear recently finalised an agreement, effective January 2007, to acquire EMXCo, the UK’s leading provider of mutual-fund order routing, to deliver enhanced UK fundprocessing efficiency and cost savings. (www.emxco.com)
