Euronext Securities has entered into an agreement to provide asset services to Clearstream Banking AG as Investor CSD [central securities depository] for the Danish market.
The agreement builds on long-term cooperation between the two infrastructures and is aimed at facilitating access to the Danish capital markets.
The two CSDs have worked together in Denmark for 13 years.
Euronext said it believes direct participation and CSD collaboration ultimately benefits capital markets and reflects its ambitions across the European post-trade industry.
“Across Europe, we’re seeing a growing trend that the value chain between issuers and investors can get shorter, notably with more direct connections between CSDs.” said Pierre Davoust, head of CSDs at Euronext.
“There are advantages to accessing the market directly, such as more transparency, lower operational risk, and some of our customers prefer this approach. We’re responding to this trend by expanding our existing portfolio of asset services and, in time, we can see this becoming a pan-Nordic offering for our customers that choose to go this route.”
Clearstream said the new agreement is part of a larger strategic initiative to create a more efficient operational set-up through direct market access, as Sam Riley, head of investor services and financing at Clearstream, elaborates: “Our Investor-CSD model offers access to T2S-in and -out markets, as well as to the international markets via a central access point.
“It is designed to improve our customers’ operational efficiency and to reduce operational and counterparty risk. Connecting directly to the comprehensive asset services of various CSDs allows us to offer our customers the set-up and securities service quality they seek – as we are doing now with Euronext Securities. We look to further broaden this engagement, both in Europe and beyond. Ultimately, this is one supporting building block to increase the efficiency of the European capital markets.”