CME Clearing chooses BNP for US custody

BNP Paribas will provide custody services via its branch in New York having started providing local custody in the US in 2012.
By Paul Walsh
BNP Paribas Securities Services has been selected to provide custody services via its New York affiliate branch to CME Clearing, continuing its drive in the US.

The custodian is trying to break the hold of the big four in the US, after launching its local custody in the US in 2012 to provide post-trade services to international banks, brokers and institutional investors.

BNP Paribas is now one of CME Clearing’s approved custodians for US Treasury and federal agency securities.

As a result of this partnership, CME clearing members now have an additional option to diversify their holdings of performance bond deposits, which are used for margin collateral.

“With the addition of BNP Paribas, CME Group provides greater diversity of custodians to our global clearing members and clients to support their collateral management needs at CME Clearing,” said Sunil Cutinho, president, CME Clearing.

As a direct securities participant to the Federal Reserve in the US, BNP Paribas will also aid CME Clearing and its members in enhancing operational efficiency, as Fed-eligible securities are the main asset class for performance bond collateral.

“We are delighted to add such a prestigious customer to our US client base. This is testament to the work we have been doing since launching custody in the US in 2012,” said Bruno Campenon, Americas head of custody and clearing services for BNP Paribas Securities Services.