DBS, a large Asian bank based in Singapore, is reporting that it has become the first bank in Asia to complete an intraday repurchase transaction on JP Morgan’s intraday repurchase application on Onyx Digital Assets. The application is a blockchain-based network that supports instant settlements and maturity of the transactions within hours as opposed to the current standard of two days.
Onyx Digital Assets enables atomic (instant) settlements and allows repo transactions to be traded, settled, and matured within hours.
As a jurisdiction, Singapore has pushed forward in incorporating distributed ledger technology to improve upon established banking processes and tech stacks.
Andrew Ng, Head of Treasury and Markets at DBS, commented on the transaction:
“Repurchase agreements or repos are a traditional and well-established method of raising financing, but infrastructural and technical inefficiencies meant the minimum term has usually been one day. In the past, banks around the world had to explore alternative routes for intraday financing requirements. Through leveraging efficiencies of a blockchain-based solution, we are able to raise USD funding in compressed timeframes which are beneficial to our liquidity needs.”
He added that his bank will continue to leverage leading technologies to provide accelerated liquidity and risk management.
JP Morgan Head of Markets, Distributed Ledger Technology Scott Lucas explained hat their intraday repo solution helps clients boost operational efficiencies and accelerate settlement times for their repo activities.
“We are excited to have our first Asia-domiciled client live on the application as the network continues to grow.”
Ed Bond, Head of Trading Services Asia Pacific at JP Morgan added:
“This is the first time that J.P. Morgan is acting as both Triparty Agent and Collateral Token Agent, which is an exciting development for the market. DBS has been a great partner on this project and we will continue looking at ways to innovate and help our clients navigate market challenges.”
While much discussion swirls around digital asset trading and speculation, many industry observers believe there is value in process improvement with distributed ledger technology.