Clearstream and Bundesbank act to reduce liquidity risk

Clearstream and Bundesbank act to reduce liquidity risk

Clearstream has partnered with the Deutsche Bundesbank and other EU central banks to offer access to central bank money for foreign traders clearing cross-border securities transactions through the German markets.

Under the model, non-German participants make liquidity available for the German market by means of deposits in cash or securities at their national central bank, which submits a cross-border guarantee to the Bundesbank.

Matthias Ganz, CEO of Clearstream Banking Frankfurt, says the model "contributes to a level playing field by making the same access to central bank money available to domestic and foreign participants in cross-border transactions."

Two central banks, along with Deutsche Bundesbank, are currently offering the service.

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