EuroCCP and LCH.Clearnet have both been selected to provide clearing and settlement services for SmartPool - the pan-European electronic block trading platform being established by Nyse Euronext in partnership with HSBC and BNP Paribas.
SmartPool is a multilateral trading facility (MTF) providing a dark pool for the execution of large institutional order flow in stocks from 14 European countries. The system will be accessible to all European sell-side firms.
Both EuroCCP and LCH.Clearnet will support trading of European stocks offered on the London-based platform. LCH.Clearnet, as Euronext's contracted central counterparty, will provide clearing services for stocks listed in the four Euronext markets - Amsterdam, Brussels, Lisbon and Paris. Settlement will be provided through the local CSDs.
Meanwhile EuroCCP will provide services for the stocks traded in 10 other European countries - Austria, Denmark, Finland, Germany, Ireland, Italy, Norway, Sweden, Switzerland and the UK. Citi's global transaction services business will act as EuroCCP's settlement agent and handle settlement in the respective central securities depositories (CSDs).
Says Roland Bellegarde, head of European cash markets at Nyse Euronext: "SmartPool's unique 'open' business model, whereby we have agreements with two clearing providers, enables us to offer our future customers the most appropriate, competitive and attractive services and environment for the trading of European stocks. By offering a combination of EuroCCP/Citi and LCH.Clearnet we have selected the most efficient low-cost clearing solution for SmartPool customers."
Nyse Euronext says the clearing deals enable SmartPool to take "a significant step closer to the delivery of the trading platform planned for after the summer, subject to regulatory approval".
DTCC subsidiary EuroCCP has also been selected to provide services to bank-backed equities trading facility Turquoise, which is gearing up for a launch in the summer. Meanwhile LCH.Clearnet will provide clearing and settlement services for Börse Berlin's MiFID-compliant pan-European Equiduct Trading platform, which is also expected to launch in the middle of the year.
News of the Smartpool deals follows reports last week that LCH.Clearnet is in talks with the US Depository Trust & Clearing Corporation (DTCC) about a possible merger that would create the first transatlantic provider of post-trade services.