Eurex Clearing has extended the product and service scope of its Lending CCP, Europe’s first central counterparty (CCP) service for the bilateral securities lending market.
Since early June, equities from three additional European countries are accepted and a solution for voluntary corporate actions has been introduced.
Blue chip equities from Belgium, France and the Netherlands are now eligible for the Lending CCP service that already covers equities from Germany and Switzerland and a wide range of international fixed income instruments and exchange-traded funds. A full range of voluntary corporate actions is now included in the service, based on bilateral agreements between lenders and borrowers.
Since the introduction of the Lending CCP in November 2012, further market participants made the decision to use this service offering from Eurex Clearing. Building on the successful completion of the pilot phase, market participants committing to the Lending CCP include DekaBank, ING Bank, Maple Bank, Natixis, Nomura International, Société Générale and Santander Global Banking & Markets.
“The design of the CCP service by Eurex Clearing ensures that the bilateral trade negotiation aspect of the securities lending market is retained and enables us to continue to manage our counterparty relationships,” says Walter Kraushaar, global head of securities finance at Maple Bank.
“Eurex Clearing has provided pioneering features such as a specific lender license that benefits both agent lenders and their beneficial owners,” says Michael Cyrus, head of short term products at DekaBank.
“We are happy our close cooperation with leading market participants has helped us to build our innovative offering. Our Lending CCP service preserves the special structure of the securities lending market and offers the capital efficiency and safety of a proven and recognised CCP model – making our offering unique,” says Thomas Book (pictured), chief executive of Eurex Clearing.
The Lending CCP service is based on Eurex Clearing’s systems and risk management standards. Securities lending transactions from Eurex Repo’s SecLend Market or via Pirum’s CCP Gateway can be cleared by Eurex Clearing. The service is integrated with two tri-party collateral agents, Clearstream Banking Luxembourg and Euroclear Bank.