Clearstream, the post-trade service and global liquidity provider within Deutsche Börse Group, is the first international central securities depository (ICSD) to include Brazil in its cross-border settlement network.
The company now offers settlement and custody services for all asset classes denominated in Brazilian Real. The link, which went live on 21 January, gives Clearstream customers the opportunity to develop post-trade solutions for the Brazilian market using Clearstream as their single point of access. Itaú Unibanco is Clearstream's local partner and will act as sub-custodian.
Mark Gem, member of the Executive Board and head of network management at Clearstream, said: "The settlement link to Brazil is key in light of our BRIC strategy and an important additional element to our presence in Brazil where we have already developed a collateral management solution for the local market.
We are pleased to be the first European market infrastructure provider to launch a post-trade service for Brazil with Itaú Unibanco as local partner who best knows the requirements of this very large and segregated market."
Ricardo Lima Soares, director of the Capital Markets Solutions Group at Itaú Unibanco, said: "We are very pleased to support the leading European post-trade services provider Clearstream to further enhance its presence in Brazil. The new settlement link will allow the large international investor base to more easily access the Brazilian market. We believe that our in-depth knowledge of the Brazilian and South American financial markets assures that Clearstream clients will be provided the best possible service on site."
Clearstream has a long-standing presence in South America and in Brazil specifically. Its first steps in the region date back to the early 1990s.
Clearstream and Brazilian Central Securities Depository (CSD) CETIP launched an initiative in June 2010 to jointly develop and distribute triparty collateral management services across time zones. In the first phase, this service will be available for the Brazilian market. CETIP operates the leading marketplace for fixed income securities and over-the-counter (OTC) derivatives in Latin America.
Clearstream has the largest ICSD settlement network covering 50 domestic markets across the world. Brazil is the company's third link to the important BRIC (Brazil, Russia, India, China) countries following existing links to the Russian market and to China where Clearstream processes the only currency eligible for settlement, the Chinese Renminbi held outside mainland China.
Talks are already under way on access to the Indian market. The Clearstream network also includes all Eurozone countries, except Malta.