Cassa Di Compensazione & Garanzia to be CCP for Borsa Italiana

Cassa Di Compensazione & Garanzia to be CCP for Borsa Italiana

Borsa Italiana is to implement a central counterparty clearing mechanism for equities trading, managed and developed by Cassa Di Compensazione E Garanzia on 23 May 2003.

Cassa Di Compensazione E Garanzia says it will initially use its current Liquidazione dei Titoli (LdT) system to guarantee all contracts on stocks, convertible bonds, warrants and shares of closed-end real estate and securities funds on the Italian stock markets, but will move to the Express II settlement system, which was developed by its subsidiary Monte Titoli.

Margin collateral will be calculated using the Theoretical Intermarket Margins System (Tims), developed by Chicago-based Options Clearing Corporation.

Renato Tarantola, CEO of Cassa di Compensazione e Garanzia, says the CCP system "is a risk management system that is more efficient and open to interoperability with analogous systems that brings our stock markets into line with international best-practice."

The CCP will not initially be involved with the Mercato Ristretto or the bond and government securities market (MOT) and current contract guarantee mechanisms will continue to be valid for the Covered Warrant Market (MCW).

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