DTCC, Clearstream And Euroclear Enhance Automation In MTN World With EPIM

The Depository Trust & Clearing Corporation (DTCC), Clearstream Banking and Euroclear Bank are expanding the scope of the European Pre Issuance Messaging (EPIM) system to support Euro Medium Term Note (MTN) market. EPIM will now automate the pre issuance communication

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The Depository Trust & Clearing Corporation (DTCC), Clearstream Banking and Euroclear Bank are expanding the scope of the European Pre-Issuance Messaging (EPIM) system to support Euro Medium-Term Note (MTN) market.

EPIM will now automate the pre-issuance communication and International Security Identification Number (ISIN) allocation process for Euro MTNs.

The Euro MTN market has grown 22% over the past two years, from US$6.4 trillion (5.0 trillion) outstanding in early 2007 to US$7.8 trillion (6.1 trillion) in early 2009.

EPIM significantly reduces manual processing costs for the industry, eliminating the labour-intensive and error-prone phone, fax and email-based communications generated during the ISIN request and allocation processes. Through a streamlined messaging and automated workflow, EPIM increases accuracy and reduces processing errors, discrepancies and delays, while preserving the flexibility that characterises the short-term debt money markets.

Bringing automation to the ECP marketplace with EPIM has helped drive down costs for new issuances and enhance efficiencies for market participants, says Susan Cosgrove, managing director, Clearance and Settlement Group, DTCC.

By leveraging the EPIM system to bring automation to the MTN market, we are taking another important step in evolving the infrastructure to meet the needs of financial firms and investors. EPIM will eliminate the time consuming and outdated manual processes of the MTN market and help play a role in spurring long-term growth.

Taking a proven system like EPIM and leveraging its capabilities and benefits to other asset classes is an excellent way of adding value for clients, says Olivier Grimonpont, director, Fixed Income Product Management, Euroclear. As an automated solution that reduces costs and increases efficiency, we believe EPIM will be a welcome improvement to the MTN market, particularly during these times of financial pressure.

Now we have the opportunity to bring a similar and much-needed degree of operational efficiency to the MTN market, which we believe is essential to foster greater growth in the years ahead, says Mark Kieffer, head of Issuance & Distribution Services, Clearstream Banking. As an increasing number of investors turn to the MTN market, we are now fully prepared to manage pre-issuance communication and issue new ISINs quickly in an automated environment.

EPIM has brought us closer to achieving full straight-through processing in the European commercial paper marketplace, says Peter Eisenhardt, chairman of the International Capital Market Associations ECP Committee. Speed is absolutely critical, especially when theres volatility in the money markets. With EPIM, ISINs are assigned in less than five minutes.

The ICMSA membership is delighted to see EPIM extend its coverage to MTNs, says Graham Cox, chairman of the International Capital Market Services Association. EPIM has proven to be a great response to the market’s need for a secure, efficient and reliable pre-issuance communication tool. Given its capabilities in terms of volume and speed, and contribution towards STP, we encourage the issuing community to adopt the expanded functionality EPIM offers.