Euroclear reports 20% increase in settlement turnover

As a result, new record levels were achieved in turnover, custody and collateral provision outstanding. These accomplishments can be attributed to a combination of strong organic growth across the group and, at the level of Euroclear Bank, the group's ICSD, of significant gains in market share.
Pierre Francotte, chief executive officer of Euroclear SA/NV, said: "Working in close collaboration with our clients, we have made significant progress over the past year in our efforts to deliver a more consolidated and harmonised settlement infrastructure. Nonetheless, we remain as focused on supplying products and services that satisfy our clients' day-to-day operational needs now as on delivering the most efficient and cost-effective post-trade infrastructure for our markets in the future."
Operating highlights
The combined results of the Euroclear group in 2004 show significant performance improvements across all key parameters:

• Turnover, or the value of securities transactions settled, was EUR 307.1 trillion, an increase of 19.9% on the EUR 256.2 trillion recorded in 2003.
• The value of securities held for Euroclear clients at year-end 2004 was EUR 13.1 trillion, an increase of 10.2% on the EUR 11.9 trillion registered for 2003.
• The number of netted transactions settled in Euroclear increased to 115 million in 2004, compared with 114 million in 2003, despite the ongoing contribution of netting and central-counterparty service providers to the group's CSDs.
• The combined average daily value of collateral provision outstanding in Euroclear Bank and CRESTCo rose by 25.7% to EUR 323.4 billion in 2004, up from EUR 257.4 billion in 2003.

Breakdown per Euroclear entity
Turnover
Euroclear Bank's 2004 turnover of EUR 132.6 trillion represents an increase of 12.2% on the 2003 figure of EUR 118.1 trillion. Turnover at Euroclear France was EUR 60.2 trillion, an improvement of 14.3% on the EUR 52.6 trirnover at Euroclear France was EUR 60.2 trillion, an improvement of 14.3% on the EUR 52.6 trillion reported fported for the previous year, while CRESTCo's turnover was EUR 114.3 trillion, a gain of almost 34% compared to the EUR 85.5 trillion registered in 2003. Turnover figures for Euroclear Nederland are not available.
Securities held (depot)
The total value of securities held in custody for clients by Euroclear Bank totalled EUR 5.9 trillion in 2004, a rise of 11.9% on the EUR 5.3 trillion recorded in 2003. This gain includes more than EUR 70 billion in net new business won from the other international CSDs during the year. Over the past three years, Euroclear Bank has attracted in excess of EUR 340 billion of net new depot business from the other ICSDs. At Euroclear France, the total value of securities held in 2004 was EUR 3.8 trillion, a 7.6% increase from last year's EUR 3.5 trillion, while securities held through CREST increased by 11.3%, from EUR 2.4 trillion in 2003 to EUR 2.7 trillion in 2004. Depot in Euroclear Nederland at year-end 2004 was EUR 757 billion, a rise of 6.5% from EUR 711 billion in 2003.
Number of transactions settled (after netting)
In 2004, Euroclear Bank settled 24 million transactions, an increase of almost 11% on the 22 million processed in 2003. Euroclear France settled 27 million transactions in 2004, compared to 28 million in 2003. This modest decline can be attributed mainly to the efficiencies of netting and relatively low trading-activity levels in the French retail market during the year. Transaction volumes in 2004 at both CRESTCo and Euroclear Nederland were on a par with those in 2003, with 61 million transactions being processed in CRESTCo and 3 million in Euroclear Nederland.
Average daily value of collateral provision outstanding
For Euroclear Bank, average triparty collateral management deals outstanding rose by almost 27% in 2004, to a record EUR 162.0 billion per day, compared with EUR 127.9 billion in 2003. Daily peaks were in excess of EUR 174 billion, also an all-time high. At CRESTCo, daily Delivery-by-Value (DBV) instructions – which a Crest member issues to assemble a package of securities from a specified account to deliver to another member as collateral – increased by almost 25% in 2004 to the equivalent of EUR 161.4 billion, compared with EUR 129.5 billion in 2003.
With the successful implementation during 2004 of the 'Automated Daytime Bridge' between Euroclear Bank and Clearstream Banking Luxembourg, interoperability and settlement efficiency between the two ICSDs have been improved even further. Nevertheless, larger numbers of new and existing clients have elected to settle their securities transactions on a book-entry basis in Euroclear Bank, with Bridge transactions accounting for a dwindling proportion of overall business. In fact, the value of such transactions, taken as a proportion of total Euroclear Bank turnover, has declined by 41% since 1999, while volumes have decreased by 38%. Meanwhile, almost 88% of Euroclear Bank's 2004 turnover of EUR 132.6 trillion represented trades settled directly between Euroclear Bank clients.
FundSettle™, Euroclear's dedicated processing platform for fund transactions, now covers approximately 23,000 domestic and offshore funds, having added more than 3,000 funds in 2004. The number of active FundSettle accounts increased by 85% in 2004, while the volume of transactions processed on the platform increased by more than 43%. These figures emphasise the significant impact of Europe's only fully integrated fund-processing platform, as the market clearly recognises the cost and efficiency benefits to be derived from switching to the automated and standardised straight-through processing features of FundSettle.