Source: Euroclear
Euroclear Bank clients will benefit from a EUR 7 million reduction in fees for choosing Euroclear Bank to manage their collateral.
Commencing 1 November 2005, clients will save 25%, on average, in settlement and service fees as a direct result of the economies of scale that are offered from the consistently higher volumes of business that clients place with Euroclear Bank's triparty collateral management service. The latest record of average daily collateral outstanding is EUR 225 billion, having increased 40% since the beginning of the year.
Olivier Grimonpont, Director, Collateral Management and Securities Lending at Euroclear Bank, said: "Euroclear Bank's efforts to reduce the cost of using a collateral agent offers a compelling business case for clients to outsource more of their collateral management needs for bilateral transactions to us, particularly for more complex securities lending transactions. In addition, with the implementation of Basel II, where secured financing will become even more critical, demand from the general collateral market for triparty collateral management services will only increase."
Also effective 1 November, Euroclear Bank will offer its Triweb online reporting service free of charge to all clients. Triweb offers both collateral givers and takers the opportunity to manage their collateral positions very efficiently, and is a service feature that is currently not available for bilateral transactions.
The new, low tariff strongly supports Euroclear Bank's commitment to provide the most appealing environment in which clients may consolidate their pool of collateral in a cost-effective manner. Clients may optimise their use of collateral across products – repos, securities lending, derivatives, secured loans and central-counterparty margin call management.
Average daily triparty collateral management outstanding at Euroclear Bank has multiplied by a factor of five over the past five years. As business volumes continue to grow, Euroclear Bank is committed to sharing the benefits of additional economies of scale with its clients, while focusing on delivering customer value.