Clearstream and Euroclear to launch second phase of 'automated daytime bridge'

The 'Bridge' is an electronic communications link which facilitates the efficient settlement of securities transactions between counterparties in Clearstream Banking Luxembourg and Euroclear Bank. The jointly managed project, which improves interoperability between the two ICSDs, has been run with smooth co-operation between both organisations. Further efforts to improve the interoperability between both ICSDs will continue.

This second phase will enable same-day settlement of trades over the Bridge between counterparties located in the different ICSDs. Clients will benefit from extended Bridge instruction-input deadlines into the daytime (from 20:30 CET the evening before settlement date to 13:30 CET on settlement date). Customers of both ICSDs will benefit from improved Bridge transaction-settlement efficiency by having greater flexibility to repair unmatched instructions and by automatically recycling failed trades in the daytime cycle. These enhancements also provide the infrastructure for same-day (T+0) Bridge transactions.

Phase One, successfully launched on schedule in June 2004, led to improved settlement efficiency of Bridge transactions and the capability to re-deliver securities from more local markets across the Bridge during the day. Phase One has enabled clients to reduce their financing costs by having more opportunities to settle Bridge transactions that failed during the overnight process. Additionally, there has been a reduction in the risk exposure between the ICSDs for Bridge transactions.