Paris
25 October 2016
Reporter: Drew Nicol

BNP Paribas plans repo clearing expansion


BNP Paribas Securities Services is working with central counterparties to extend its European third-party clearing services for the repo clearing of bonds to more countries.

The bank already provides this service for French, Spanish and Italian bonds.

In a statement on its ongoing and upcoming market initiatives, the bank didn’t specify which countries it is looking to include next.

BNP Paribas also clarified that its Collateral Gateways solution for banks and brokers has been upgraded in line with the newest Target2-Securities (T2S) requirements.

According to the bank, the improved functionality will allow its clients to benefit from the T2S auto-collateralisation services, along with the bank’s Collateral Gateways independently.

BNP Paribas Securities Services gives clients the option to settle their trades using their dedicated cash account in T2S.

The bank has also become a direct securities participant to the US Federal Reserve through FedLine, the Federal Reserve’s online financial services information and payment service.

This facilitates its clients’ set-up and growth in the local fixed income securities market and allows for improved settlement turnaround and reporting, as well as first-hand pre-qualified information on income events.

Direct connectivity also facilitates and protects clients’ securities margin and collateral movements.

Alain Pochet, global head of clearing, custody and settlement at BNP Paribas Securities Services, said: “Financial institutions need fast and efficient access to local fixed income markets to satisfy their need for high quality collateral. In addition, regulations are pushing investors to hold sovereign debt and corporate bonds.

“All this comes at a time when the markets are concerned with a possible shortage of government and corporate bonds.”

“As a global custodian and asset servicer, we see it as our role to help our clients secure the collateral they need and enable them to fulfil their investment strategies. That is why we are participating in a number of initiatives to give our clients direct access to local fixed income markets around the world.”

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