Standard Chartered has announced that it is the first foreign bank to offer its clients a one-stop derivatives clearing services in India.
Available since June 2005, the bank’s derivatives clearing solution covers clearing and settlement of derivatives trades of index futures, index options, individual stock futures, individual stock options, interest rate futures, done on the country’s National Stock Exchange (NSE). It targets both foreign and local institutional investors, including domestic mutual funds.
“The move takes the bank into what has traditionally been a broker dealer domain. The Bank’s new franchise answers client interest in broader settlement coverage and increasing appetite for integrated securities services products and solutions,” says Paul Hedges, Standard Chartered’s global head for securities services.
“International clients shopping for a one-stop shop now have it with Standard Chartered,” says Hedges. As a leading securities services provider, the Bank was settling equity and debt instrument investments for clients prior to extending its coverage to derivatives clearing.
“With settlement of equity, debt investments and the clearing and settlement of derivatives sited in one house, investors can realize improved risk and cash flow management,” explains Hedges.
The product has been developed as an extension of the bank’s core custody capability in India and is aligned with expected market trends such as the introduction of settlement in the underlying stocks as against the current mode of cash settlement.
The bank is looking to roll out the derivatives clearing service across the region as markets develop.