22 July 2014
Deutsche Bank today announces a partnership with Clearstream and Euroclear to help clients consolidate, optimise and more efficiently assign their collateral inventory as part of the TARGET2-Securities (T2S) initiative. The partnership will provide clients with a single entry point from which they can reach the collateral pools and distribution channels used by all key institutional and market infrastructure firms. As part of Deutsche Bank’s broader collateral and liquidity solution, the agreements with the two international securities depositories will open the Bank’s architecture to offer clients access to a vast range of institutional collateral takers.
Rafael Moral, Head of Investor Services, Institutional Cash & Securities Services at Deutsche Bank, said: “This partnership with Clearstream and Euroclear forms part of Deutsche Bank’s larger T2S strategy which is designed to provide our clients with direct access – through a centralised technical hub – combined with specialised local expertise and client service. We believe our T2S offering is truly complete and compelling; it combines a wide choice of operating models and value-added services with the kind of liquidity that only a leading global franchise such as Deutsche can deliver.”
Jo Van De Velde, Managing Director and Head of Euroclear’s Product Management Division, said: “We are delighted to partner with Deutsche Bank in order to enable their clients to take a holistic approach to collateral management with unprecedented cost and operational efficiencies that only a market infrastructure like Euroclear can deliver. By connecting to Euroclear’s Collateral Highway, clients can source, mobilise and allocate securities from wherever they are held, unlock central bank liquidity, post collateral in response to CCP margin calls and access a broad array of secured transactions including tri-party repos and securities loans. Today’s announcement signals another significant step in the development of an open and industry-led collateral ecosystem.”
Jean-Robert Wilkin, Head of Product Management of Clearstream’s Global Securities Financing division, said: “We progress on our journey to bring global exposures and collateral locations efficiently and reliably together: our Global Liquidity Hub links an increasing number of clearing houses globally to collateral aggregators like central securities depositories, exchanges and agent banks like Deutsche Bank. Going via Clearstream will allow our clients to manage their collateral needs in a T2S environment and beyond in real-time. We are pleased to soon grow our collateral pool with Deutsche Bank’s liquidity.”
The partnerships with Clearstream and Euroclear will give clients the opportunity to make better use of assets held domestically to secure exposures and financing transactions in tri-party, whilst consolidating the view of inventory with their preferred provider. Clients will benefit from a reduction of funding costs by mobilising eligible assets cross-jurisdictionally in a safe and custody-integrated framework. The global footprint of this direct custody franchise will facilitate reach beyond T2S and free up assets otherwise idle to be used to fulfil margin obligations in automated cross border book entry transfers.