London
03 July 2017
Reporter: Stephanie Palmer

New settlement netting service launches for OTC FX


NEX Optimisation has launched its automated settlement netting service, which it calls the first of its kind in the industry.

The service has been initially launched for over-the-counter (OTC) foreign exchange (FX) trade, and is expected to be rolled out to other asset classes in the future.

It is intended to remove the manual process of netting between clients by applying an application programming interface to communicate between clients’, banks’ and custodians’ systems.

An automated workflow will also allow for visibility and control around payment preparation for net and gross trades.

According to NEX, around $150 billion is settled every day between clients and dealers, but settlement failure rates are 3 percent.

The netting service should minimise intra-day settlement exposure, reduce settlement fails and provide greater certainty of funding needs.

Joanna Davies, managing director at Traiana, said: “The settlement netting service will allow traders to execute with any bank on any trading venue and enjoy optimised, efficient, automated and consistent post-trade processing from execution through settlement.”

“Settlement netting processes have traditionally been fragmented across organisations and asset classes, requiring extensive manual processing, which does not reflect the way in which the market is moving. By automating the entire netting process via a central hub, we’ve brought an essential tool to the market that will significantly reduce breaks and have a direct impact on costs for our clients.”

More clearing and settlement news
The latest news from Asset Servicing Times
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
Japan earmarks Q2 2019 for T+2 settlement shift
07 November 2017 | Tokyo | Reporter: Drew Nichol
Japan has unveiled a “tentative” timeline for its exchanges’ shift from a T+3 to T+2 settlement cycle, with eye towards Q2 2019
Iberclear bank on Citi to provide global custody
20 October 2017 | Madrid | Reporter: Jenna Lomax
The agreement, signed at this years Sibos conference in Toronto, will enable Spanish clearing houses to settle international securities via local CSDs
Eurex Clearing launches partnership programme
09 October 2017 | Frankfurt | Reporter: Theo Andrew
The programme plans to build a “balanced ecosystem”, responsible for aligning responsibilities and benefits related to economics and governance, bringing “greater choice and transparency” to the market
BNP Paribas becomes first French OTC Clearing member
20 September 2017 | Hong Kong | Reporter: Barney Dixon
BNP Paribas has joined OTC Clearing Hong Kong, as the clearinghouse’s 17th member, and the first from France
Ten-year T2S saga comes to an end
19 September 2017 | Brussels | Reporter: Stephanie Palmer
The Target2-Securities pan-European harmonised settlement platform is finally fully operational, as the Spanish and Baltic markets completed their migration yesterday
SEC praises “smooth” T+2 transition
12 September 2017 | Washington DC | Reporter: Stephanie Palmer
SEC chair Jay Clayton said the move on 5 September “represents a significant accomplishment” for the industry
Citi and Deutsche Bank execute first SwapAgent trades
07 September 2017 | London | Reporter: Jenna Lomax
LCH’s new SwapAgent service has completed its first trades, facilitating an interest-rate swap and an inflation swap between Citi and Deutsche Bank
More clearing and settlement news