Euroclear recently announced a significant enhancement to its partnership with LCH SA, which will enable clearing members to settle all Italian government debt traded on MTS and BrokerTec, and cleared via LCH SA. This will reportedly include cash as well as repo at Euroclear Bank, the International Central Securities Depository of Euroclear group. The service is set to be available at some point next year.
This latest development marks another step in deepening integration across Europe’s post-trade ecosystem and will enable market participants to “benefit from enhanced balance sheet netting and greater operational efficiency.”
By enabling settlement within Euroclear Bank, clients are now able to gain access to a broader, more efficient network for euro-denominated securities. This model reduces fragmentation, “enhances collateral mobility and reinforces the principles of open infrastructure and client choice.”
Additionally, settling directly via Euroclear Bank should enable the mobilisation of Italian government debt “onto Euroclear’s Collateral Highway for securities financing and funding opportunities.”
Michel Semaan, Global Head of RepoClear, LSEG, said that as a provider of clearing services for Italian government debt, they are looking forward to working with Euroclear to bring efficiencies and choice to members, “both key elements of a competitive European capital market.”
Sebastien Danloy, Chief Business Officer, Euroclear group, commented that they are pleased to bring this solution to the market together with LCH. Danloy further noted given that Italian government debt represents a significant segment of the European fixed income market, this represents a key milestone in their “vision of advancing the Savings and Investments Union.”
They added that this is centred around “greater choice, open access models and the continued development of a resilient, interconnected European capital market.”
As covered, Euroclear group is the financial industry’s provider of post trade services. Guided by its purpose, Euroclear aims to bring “safety, efficiency and connections to financial markets for sustainable economic growth.”
Euroclear offers settlement and custody of local and cross-border securities for bonds, equities and derivatives and investment funds. As a capital market infrastructure, Euroclear is committed to delivering risk-mitigation, automation and efficiency for its client franchise.
The Euroclear group reportedly consists of Euroclear Bank, the International CSD, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden, Euroclear UK & International.