The reductions are made possible through the unique Vestima+ solution enabling customers to select different elements of the service that they need rather than paying a 'bundled' price. Cost reductions will be maximized through enabling customers to combine domestic services from local central securities depositories (CSDs) with international services offered by Clearstream and other International central securities depositories (ICSDs) or even global custodians.

Clearstream has worked with market participants to leverage their existing domestic infrastructures in order to reach the highest cost reductions level. Analysis shows that the Vestima+ unbundled pricing concept could trigger savings between 20 to 60% compare to a bundled solution depending on processing volumes. For example, a French bank with an investment fund portfolio of EUR 1 billion within an overall asset portfolio of EUR 10 billion would currently face an average price for custody of the funds of 0.70 of a basis point. By combining the cost efficiencies made available through Clearstream's new Vestima+ service and with currently available domestic services, such a customer would benefit from a reduction to an average price of 0.27 of a basis point, a decrease of over 60%.

The Vestima+ service is initially targeting the differing needs of each of Europe's main domestic distributors and will provide a single solution for multiple fund markets beginning with France and Germany and the international markets centered in Luxembourg and Dublin. This flexibility enables fund distributors to select their preferred settlement mode, delivery versus payment (DVP) or free of payment (FOP) and to choose their own optimal settlement route and custody providers. Through Vestima+, and for the first time in the fund market, customers can select wherever they wish to settle and whether to use or not Clearstream's integrated settlement and custody services. For the first time, Clearstream is also offering this service to insurance companies and asset management firms in addition to its traditional customer base of banking institutions.

The Vestima+ service has been warmly welcomed by the market place with participants identifying additional cost benefits from the high straight-through
processing rates and the possibility of de-commissioning parallel systems. Clearstream has also confirmed that the testing phase of the new service will start on 22 November 2004 with current customers. The new pricing concept will be implemented with the launch of the new Vestima+ service on 22 January 2005.

Bruno Zutterling, Director Investment Fund Service at Clearstream said, "From discussions with many customers, we understand that they can clearly identify the cost benefits from using the new Vestima+ service for both domestic and international transactions which explains the high level of market interest. When this cost efficiency benefit is coupled with STP efficiency improvements close to 100 percent and the wider possibility of accessing more markets, the business logic for adopting Vestima+ becomes compelling."