Source: Clearstream
DekaBank, the securities services provider of the German Savings Banks Finance Group, has chosen Clearstream, Deutsche Börse Group’s post-trading services provider, to handle post-trading services such as settlement, custody and asset servicing for its European securities markets activities.
Austria has become DekaBank’s first market to be processed via Clearstream’s Investor CSD model. Eurobonds, Belgium, the Netherlands, France, Italy, Spain and other markets are to follow in 2020 and 2021.
Clearstream’s Investor CSD model allows DekaBank to pool its assets across the connected platforms of Clearstream’s German central securities depository (CSD) and its international central securities depository (ICSD). This increases liquidity and enables seamless transfer between CSD and ICSD counterparties with no dependency on local market infrastructures. Thus, DekaBank will reduce settlement-related exposures, pool collateral for settlement and triparty purposes, net more cash settlements and create operational efficiencies.
The model responds to an increasing market need for a fully integrated European post-trade infrastructure, allowing for both risk and cost reductions, enabling DekaBank to reap significant benefits from consolidating assets in central bank money via their own dedicated cash account (DCA). Furthermore, it allows for using one single settlement location for DekaBank’s exchange-traded and OTC, cleared and non-cleared activities.
Timo Röder, Head of Securities Settlement & Network Management at DekaBank, said: “As a German securities services provider and direct CSD participant, we have opted for an efficient T2S connection via the German CSD Clearstream. Thereby, DekaBank will have the benefit of a shortened settlement and custody chain, improved liquidity management by using central bank money via its own dedicated cash account, optimised asset pooling and asset safety.”
Thilo Derenbach, Head of European Custody Product at Clearstream, said: “We welcome the decision of DekaBank to use our Investor CSD model, which supports our customers in leveraging the opportunities of the pan-European settlement platform TARGET2-Securities. By means of our consolidated ICSD and CSD collateral pools, DekaBank can enhance liquidity and settlement management efficiencies for both central and commercial bank money.”