KAS BANK clearing specialist on Euronext Paris
KAS BANK is the first General Clearing Member of Euronext that is able to provide clients of the three underlying Euronext exchanges with its services from one portal instead of from three different connections. KAS BANK commenced its clearing and settlement services on Euronext Paris in November, after successfully completing a pilot phase with securities broker Eduard de Graaff. Euronext members can now trade on all three Euronext exchanges and have their positions cleared and settled using KAS BANK as their General Clearing Member. As from February 2002, KAS BANK can provide all its clients in Europe and outside Europe with this service. In the coming months, KAS BANK will conduct several pilots in order to gain further experience in the French infrastructure. Due to its highly automated services, KAS BANK can provide this service without any further increase in costs.KAS BANK now offers its clients one clearing and settlement protocol for the Euronext exchanges in Amsterdam, Brussels and Paris. In connection with this, KAS BANK introduces its new, automated collateral system; clients can now reduce costs by using their collateral surplus for other liabilities. Aside from these expansions, KAS BANK also provides one uniform reporting structure for the three Euronext markets. Expectations are that clients will have a better insight into the increased transaction volumes and turnover around the first quarter of 2002.
For Global Custodian article on KAS BANK (previously KAS Associate) see “KAS’s Custody Niche Across the North Sea”, IT 2001.
ESF Members Vow to Battle On
Despite the exposure of its threat to build a European central counter-party (CCP) as a bluff, the European Securities Forum (ESF) has decided not to implement the sunset clause in its constitution. The clause, which would have wound up the ESF in April next year unless members decided otherwise, was overruled at a meeting on 30 November at which members renewed their “commitment to a pan-European capital market.” ESF is also promising “new arrangements to enhance the strength of its membership and the role of its own executive.”This is understood to mean the recruitment of senior investment bankers to the executive committee of the ESF; the establishment of a permanent secretariat; and especially the broadening of the membership of ESF to include non-investment banking interests such as fund managers, custodian banks securities depositories and especially the smaller players in various national markets. Details will emerge from a full meeting of members, which is now unlikely to be held before the New Year.Though an ESF spokesman describes broadening the membership categories into new areas as “pure speculation,” the step does reflect the relative failure of an investment bank-led ESF to mould the European securities market infrastructure in its own image. The promise to appoint more senior figures to the executive committee of the ESF recalls the embarrassing collapse of the ESF threat to build their own single European CCP if the London Clearing House (LCH), Clearnet and Eurex Clearing did not build one for them. At the meeting of the EuroCCP Working Group of the ESF on 28 June, the members simply refused to put up the money. As the minutes of that meeting put it, “there is a risk to the reputation of the industry if it appears to lose interest in a development for which it has lobbied the authorities … [a decision by ESF] to abandon its objectives it could damage its reputation and prospects for successful lobbying in the future.”Considered in that light, the decision to override the sunset clause was more or less inevitable. The chief focus of interest in European CCP developments today, of course, is the future of Clearstream – currently the subject of competing bids from Euroclear and Deutsche Borse. The ESF announcement today says the organisation “continues to believe strongly in a horizontal structure which separates the governance of clearing and settlement from trading platforms … It is important to maintain vigorous pressure for horizontal consolidation.” This puts ESF squarely in the Euroclear camp (whence it came, critics might say) in the battle for control of Clearstream between Deutsche Borse and the Brussels-based clearer. But ESF will also continue to lobby for the removal of the barriers to efficient cross-border clearing and settlement in Europe, itemised in the recently published Giovannini Group report.See Global Custodian Pre-Sibos issue Summer 2001 (“Three’s Company”, pages 42-47).