Continuous Net Settlement (CNS) is available in the Paris equity market, says CCP LCH.Clearnet, which says it can now offer a single clearing window into multiple European equity markets.
The news means the Settlement Connect clearing system is installed and operational in all three major Euronext equity markets: France, Belgium and the Netherlands. LCH.Clearnet says the news “brings to completion the harmonisation of settlement links in the French, Belgian and Dutch equity markets.”
Settlement Connect was launched in the French equity market in two phases. The first phase replaced the legacy interface (ISB) with the new Settlement Connect common module, and the second phase harmonised existing clearing practices with the introduction of CNS.
“This new launch represents a major step forward in the integration of European capital markets, and will help LCH.Clearnet in its aim of delivering reduced costs to the markets it serves,” says a spokesman for LCH.Clearnet. “Settlement Connect removed the need for members to be connected to different local legacy systems for interfacing into settlement for the Belgian, Dutch and French equity markets.”
With the introduction of CNS in Paris, LCH.Clearnet SA has rationalised the fails management process and harmonised member reporting across all three trading locations. Fails are netted with new positions in the same product which are then aggregated to generate a single new settlement instruction. Corporate events on fails are now managed centrally at the LCH.Clearnet SA level.
“In improving our netting rate and centralising our fails management, LCH.Clearnet has gone one step further in the optimisation and rationalisation of our processes, bringing further efficiencies to the markets we serve,” says Christophe Hmon, Chief Executive of LCH.Clearnet SA.