CLS, a financial market infrastructure delivering settlement, processing, and data solutions, announced that BNY Mellon, the world’s largest custodian bank and ING, the largest Dutch bank, have agreed to join CLS’s bilateral payment netting calculation service for over 120 currencies, CLSNet. They are the latest participants to agree to join the growing CLSNet community, which includes eight of the top 10 global banks.
CLSNet standardizes and centralizes post-trade processes across a wide range of trade types, including same-day trades and NDFs, which helps to reduce risk and achieve greater operational efficiency for a broad range of currency flows. As settlement risk in the FX market continues to be a focus, especially in emerging market currencies and other growing segments of the market, participants are looking for ways to mitigate risk effectively via automated post-trade services such as CLSNet.
CLSNet has experienced record growth this year, underscoring the industry’s support for the service. The average daily notional value of net calculations in CLSNet have consistently exceeded USD115 billion in the last 12 months, and on 20 December 2023 it reached a record daily notional of USD445 billion netted.
Lisa Danino-Lewis, chief growth officer at CLS, said in a statement: “We are delighted that BNY Mellon and ING are joining CLSNet’s growing community of users and will benefit from the risk mitigation, operational efficiencies and liquidity advantages that the service delivers. In addition to banks, CLSNet is directly accessible to most market participants, including funds, corporates and non-bank financial institutions, making its benefits widely available to the FX industry.”
Jason Vitale, head of Global Markets Trading at BNY Mellon, said in a statement: “We are continuously identifying the latest solutions that will enhance our clients’ experience across the trade lifecycle. By joining CLSNet, this will enable us to provide clients with improvements in intraday liquidity and execution efficiency.”
Robbert Zee, FM Operations Lead at ING, said in a statement: “CLSNet provides the functionality to strengthen and standardize the post-trade processes across the global currency spectrum. As the largest Dutch bank with significant global operations, our participation in the service will be integral to our strategy to further improve operational efficiency and reduce risk for same-day currencies and currencies that are not currently eligible for CLSSettlement.”