ABN AMRO has been approved as one of the first official Settlement Members of CLS Bank International (CLS Bank), which launched yesterday following authorisation from the Board of Governors of the US Federal Reserve System.
ABN AMRO is immediately able to settle foreign exchange transactions with a group of approved Settlement Members via CLS Bank, after the successful completion of extensive testing. Continuous Linked Settlement (CLS™ ) enables cross border currency transactions to be settled intra-day on a payment versus payment basis. It is a real time, global settlement system that eliminates time zone settlement risk and represents the most dramatic advance in FX settlement for several decades.
CLS services will be offered by CLS Bank, which is supported by over 60 of the world’s largest global financial institutions. ABN AMRO is a founding shareholder of CLS Group and has played an integral development role since its inception in 1997.
John Gibbons, Head of Global Transaction Services, Financial Institutions & Public Sector at ABN AMRO, said: “CLS has been the Holy Grail of foreign exchange settlement for many years and its launch is a landmark moment for the banking industry – when a sophisticated new technology is set to transform previous ways of doing things. We are proud of our involvement in this historic development.”
The next milestone is the start of CLS Bank’s Third Party processing later this year, when ABN AMRO’s Global Transaction Services (GTS) business will be able to provide its clients with a ground-breaking CLS Third Party Service right from the beginning.
ABN AMRO is the only Settlement Member to offer free of charge testing facilities for Third Parties, that enable interested banks and trading communities to trial the multiple benefits of CLS. To date 7 leading FX providers have undergone trials and a further 40 financial institutions have signed up for the unique end-to-end testing programme.
Wolfgang Platzer, Global Head of Product Management, Financial Institutions & Public Sector at ABN AMRO Global Transaction Services, said: “CLS will rapidly become an industry standard and our testing facilities allow organisations to assess the technology, shorten implementation time and reduce cost as well as risk. The entire testing process takes a maximum of five hours per week: a small investment with a huge return.”