The new settlement service, which is based on the existing link between SIS SegaInterSettle and Clearstream, results in cost reductions for market participants of approximately EUR 10 per transaction. Both organisations are already today settlement locations for trades executed on the derivatives exchange Eurex.
Settlement is fully automated, without the need for trading parties to issue settlement instructions. The mentioned special securities transactions will be transmitted and further processed via the existing CSD link between Clearstream Banking Frankfurt and SIS SegaInterSettle. Thus, participants will benefit from a higher straight through processing rate. Further more, market participants will be able to concentrate their holdings with their preferred settlement organisation.
The three partner organisations explain: "Derived from a joint project realised by Clearstream, SIS SegaInterSettle and SWX Swiss Exchange, the new settlement service will be a benefit to the market as a whole. The implementation of this new process represents a further important step towards reducing the costs involved in crossborder settlement of German mortgage bonds: Indeed, transaction costs will decrease by more than 90 percent. The new solution underpins our goal to cooperate with infrastructure partners in order to render crossborder settlement even more efficient and to generate maximum benefit for our clients."
