Eurex Clearing AG and Clearstream Banking Luxembourg S.A. have announced that they will introduce a central counterparty service (CCP) for securities lending in early 2009, subject to regulatory approval. Eurex Clearing will act as the clearinghouse for Clearstream’s securities lending program ASLplus. The central clearing service will be based on Eurex Clearing’s systems and risk management standards.
“The introduction of a central counterparty for securities lending transactions will deliver significant efficiencies to lenders and borrowers,” says Thomas Book, member of the Eurex executive board responsible for clearing. “Against the backdrop of the financial market crisis, central clearing services have become even more important to help stabilize markets, mitigate counterparty risk and increase market efficiency.”
“With the introduction of a central counterparty for securities lending, we expect the impact to be as positive on the market as the introduction of a central counterparty for our GC Pooling market,” says Stefan Lepp, member of the Clearstream board and head of global securities financing.” The CCP will help restore confidence in the lending industry and lead to a new quality of liquidity. This joint offering once again emphasizes the advantages of Deutsche Boerse Group’s integrated business model we can offer a complete service package from a single source.”