JP Morgan has sold part of its UK securities clearing business to Deutsche Bank. The Depository Clearing Centre – inherited via Bank One but ultimately derived from the money market clearing service originally provided in London by the First National Bank of Chicago – provides clearing and custody services to the certificates of deposit market.
Morgan says the sale will enable the bank to concentrate its short term services on the commercial paper market, but the sale will inevitably encourage speculation that the senior management of the bank may be pondering a sale of the larger custody and clearing businesses.
The Depository Clearing Centre holds assets worth around $180 billion (EUR148.5 billion) and handles $30 billion worth of transactions a day. Users of the service are mainly UK banks and building societies, but also European banks. Deutsche Bank is taking on 31 Depository Clearing Centre staff as part of the deal.
No price was disclosed for the transaction.