Brazilian depository signs MoUs with Euroclear and DTCC

Source: Euroclear

Euroclear SA/NV and Companhia Brasileira de Liquidação e Custódia (CBLC), the Brazilian Clearing and Depository Corporation, have signed a Memorandum of Understanding (MoU) to build and develop a co-operative relationship in securities clearing and settlement matters.

The purpose of the agreement is to foster prosperity in Brazil's financial markets as well as those markets covered by the Euroclear group (Belgium, France, Ireland, The Netherlands, the United Kingdom and the international markets served by Euroclear Bank). Euroclear and CBLC aim to ease crossborder investment as well as explore opportunities for co-operation in clearing and settlement operations.

The MoU encompasses the following initiatives:

  • cross-entity training programmes;
  • data exchange for the improvement of clearing and settlement systems, such as statistics, market updates and business operating models;
  • regular meetings between senior management to increase mutual understanding of business developments; and
  • joint studies on topics related to securities clearing and settlement operations.

The business relationship between CBLC and Euroclear started long ago, and includes CBLC's account at Euroclear Bank, the international securities depository. As a result, CBLC has efficiently accepted securities as collateral from international customers for almost ten years.

Gilberto Mifano, Chief Executive Officer of CBLC, commented: "We are pleased to have signed this MoU with Euroclear. We trust this agreement will play an important role in further developing operational efficiency in Brazil, particularly in view of the pending merger of Brazil's BM&F SA, the local commodities and futures exchange, and Bovespa Holding SA, the publicly traded company that owns and manages the Brazilian Stock Exchange. It also responds to the growing appeal of Brazilian securities to foreign investors."

Pierre Francotte, Chief Executive Officer of Euroclear SA/NV, said: "We look forward to working more closely with CBLC as a highly valued partner in South America. We intend to continue to reinforce our relationship with clients and infrastructu in South America. We intend to continue to reinforin South America. We intend to continue to reinforce our relationship with clients and infrastructure service providers in the region, where Euroclear has been serving clients for ten years through our São Paulo office."

Separately, The Brazilian Clearing and Depository Corporation (CBLC) in São Paulo and The Depository Trust & Clearing Corporation (DTCC) in New York have signed a Memorandum of Understanding (MOU) designed to forge closer ties between the two organizations.

Under the terms of the MOU, DTCC and CBLC agree that their respective senior management and staff will meet on a regular basis to increase mutual understanding and exchange market updates, to collaborate on opportunities for improving their working relationship and to share information on business operating models.

"CBLC is a critical market infrastructure in the Brazilian capital market, which has experienced such impressive growth in recent years," said Donald F. Donahue, DTCC Chairman and Chief Executive Officer. "As the evolution of the global markets accelerates, we are pleased to work more closely with CBLC through this new agreement."

The business relationship between CBLC and DTCC started long ago, and includes CBLC's pledging location at DTCC's depository where CBLC has efficiently accepted U.S. securities collateral from international customers for almost 10 years.

"DTCC is a leading institution in the global financial community, and we believe that this closer collaboration will help us better address market opportunities and challenges in the Americas and globally," said Gilberto Mifano, CBLC Chief Executive Officer. "We are delighted to strengthen ties with DTCC."

The MOU complements the two organizations' strong relationship as active members of the Americas' Central Securities Depositories Association (ACSDA), which comprise 25 market infrastructures in the region, and of CCP12, a central counterparty clearing group consisting of 23 major clearing organizations worldwide.

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