European Central Counterparty Ltd. (EuroCCP) announced today that it had successfully begun clearing and settling trades on Feb. 2 for SmartPool, a new exchange-led, European dark pool for block trading established by the Nyse Euronext, HSBC, BNP Paribas and J.P. Morgan.
EuroCCP will be clearing trades in equities for the new platform in 10 European markets it currently supports, including Austria, Denmark, Finland, Germany, Ireland, Italy, Norway, Sweden, Switzerland and the United Kingdom. EuroCCP also recently announced that it would begin clearing and settling trades in Spain for about 100 equity issues on 16 February. LCH.Clearnet will clear and settle trades for the four Euronext markets, including markets in Amsterdam, Brussels, Lisbon and Paris. In total, about 1,000 equity issues for SmartPool will be supported.
"A key part of EuroCCP's strategy to continue supporting markets and their participants in this challenging environment for European trading is to continue to expand the number of securities and markets we clear throughout Europe, to provide central counterparty services for new types of transactions such assecurities lending, and to increase the number of trading platforms we clear for like SmartPool to build overall volume," said Diana Chan, CEO of EuroCCP. "The more volume we have, the lower the costs of clearing for everyone. All EuroCCP participants benefit equally from volume discounts, regardless of their size or the platform on which they trade."
EuroCCP has also been selected to clear and settle trades for the NYSE Arca Europe high frequency trading platform, which is expected to begin operations in the first quarter 2009, and is in negotiations with other multilateral trading facilities (MTFs) in Europe to clear and settle trades for them. Earlier this year, SecFinex named EuroCCP as the central counterparty for securities lending and borrowing for the U.K. market, the largest securities lending market in Europe. That service is expected to launch in the third quarter of this year, subject to regulatory approval.
"Volume from the Turquoise trading platform continues to grow," Chan said, "as firms search for a way to lower their costs of trading and benefit from robust clearing anand settlement. We expect that trend to continue as financial conditions remain depressed throughout this year, and EuroCCP offers the best price and best risk management capabilities of any clearing and settlement service in Europe."