At the Euroclear Asia Collateral Conference held today in Singapore, Euroclear Bank and Standard Chartered Bank commemorated the launch of their joint collateral optimisation initiative.
First announced last year, Standard Chartered Bank’s clients can now leverage Euroclear’s Open Inventory Sourcing (OIS) capabilities on the global collateral conduit known as the Collateral Highway.
Under the agreement, mutual clients are able to utilise assets held at Standard Chartered to meet collateral requirements arising in triparty repos, CCP margining and other financing deals managed by Euroclear Bank via the Collateral Highway. These assets do not leave the Standard Chartered Bank network, but are used in a virtual single cross-border pool.
The solution enables clients to use their assets held in domestic Asian capital markets to tap deep international financing sources from a wide spectrum of non-Asian counterparties. Clients are able to get the right securities collateral to the right place at the right time, and benefit from increased overall collateral processing efficiencies and lower funding costs.
George Nast, Global Head of Product Management for Transaction Banking at Standard Chartered Bank, stated: “We are delighted to strengthen our services to clients by partnering with Euroclear Bank. These are exciting times as the global capital markets adapt to changing regulations that impact the secured funding space. By joining Euroclear’s Highway and using its unique technology, we are ensuring that customers can now take a holistic approach to collateral management and liquidity provision. Safety, precision and timeliness – guaranteed.”
Olivier Grimonpont, General Manager and Regional Head, Asia-Pacific for Euroclear, commented: “Today’s collateral challenges we face are greater and more global than they have been in the past, and this calls for a global solution. Offering Standard Chartered Bank and their clients access to our open-architecture ecosystem is part of the ongoing extension of the Collateral Highway to more markets globally. Our priorities in collateral management are primarily to grow the connectivity that we have on the Collateral Highway, in terms of both sourcing and delivering both bonds and equities from around the world on behalf of our clients in an automatic and frictionless manner. We are honoured that we have been chosen by this local financial powerhouse to improve liquidity flows into and out of Asia.”
Today’s signing ceremony follows the recent joint venture announced by Euroclear and the DTCC, forming “DTCC – Euroclear Global Collateral Ltd”, which optimises collateral movements for clients of these depositories on a transatlantic basis.
The Standard Chartered / Euroclear Bank collateral partnership ensures that mutual clients of both institutions achieve greater risk protection and can manage their available assets more efficiently across business lines, irrespective of geography. Euroclear Bank has also partnered with Citi and BNP Paribas Securities Services to offer similar cross-border collateral pooling initiatives.