The Hong Kong Monetary Authority (HKMA) is to provide settlement of international stocks through a link between its Central Moneymarkets Unit and Euroclear.
Scheduled to go live by the end of 2002, the new real-time connection will enable investors in Hong Kong and other parts of Asia to directly hold and settle Euroclear-eligible debt securities via their CMU accounts.
In 1994, an indirect one-way link was established from Euroclear to the CMU, enabling Euroclear clients to clear and settle debt securities lodged with the CMU.
Joseph Yam, chief executive of the HKMA, says: "This enhancement of the excellent relationship we already have with Euroclear is a significant step in the development of efficient and safe debt trading in the region, and should be especially convenient to those managing global portfolios from or through Hong Kong."
Pierre Francotte, chief executive officer, Euroclear Bank, adds: "Asian investors will be able to settle Euroclear-eligible securities in their own time-zones, while clients in non-Asian markets will be able to access an even broader range of trading counterparties."