SGX and Clearstream offer collateral solution 12 September 2013Singapore Reporter: Georgina Lavers
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Singapore Exchange (SGX) and Clearstream are to jointly offer a collateral management solution which aims to enable customers to easily use assets held at SGX’s securities depository, CDP.
Under the agreement, SGX uses Clearstream’s collateral management infrastructure, the Global Liquidity Hub, and offers its Liquidity Hub Hub global outsourcing service, to enable collateral to be allocated, optimised and substituted on a fully automated and real-time basis. Singapore’s market infrastructure remains strong as the service ensures collateral remains within domestic jurisdiction.
Muthukrishnan Ramaswami, president of SGX, said: “We are pleased to partner Clearstream in providing our customers a collateral management offering which meets their needs at a time when they are increasingly concerned about risks and regulatory changes. We will also work with Clearstream to expand this offering to other markets in the region. By becoming the first Asian securities depository to offer this service, we strengthen and enhance Singapore’s position as a leading financial centre.”
Jeffrey Tessler, CEO of Clearstream, said: “We are delighted to expand the Liquidity Hub GO partnership model to Singapore Exchange and to bring our unique collateral management outsourcing solution to Asia. Together with SGX, we will be able to develop a tailor-made collateral management solution for Singapore in a very short time-to-market. High quality collateral is scarce and increasingly expensive—making it available is also a top industry priority in Asia. SGX and Clearstream will soon be able to jointly address this major industry challenge for the Singapore and Asian markets.”
Clearstream’s Liquidity Hub GO service went live with the Brazilian CSD Cetip in July 2011 and will be launched with the ASX Group, Australia, the South African CSD Strate and Spanish CSD Iberclear in the course of 2013. The Canadian CSD, CDS, has also signed a Letter of Intent with Clearstream.
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