BNP Paribas Securities Services today announced that it has extended its European clearing capabilities to be the first to provide third party clearing of bonds in France, Spain and Italy.
Previously, market participants wanting to clear fixed income product in those markets would have been required to become direct members of a central counterparty (CCP).
In extending its global clearing membership of LCH.Clearnet SA and CC&G to cover fixed income, BNP Paribas now offers market participants a complete set of solutions to optimise their post trade process and liquidity requirements.
“Fixed income is beginning to get back some of its lustre and increasing numbers of clients are turning towards clearing flows to reduce counterparty risk, as opposed to settling trades bilaterally,” said Philippe Ruault, Head of clearing, settlement and custody products at BNP Paribas Securities Services.
“In parallel, ongoing legislation such as EMIR and Dodd Frank continues to push more instruments onto standardised clearing infrastructures. The combination of these factors is contributing to a real surge in demand,” Mr. Ruault continued.
By outsourcing their clearing operations, market participants benefit from a reduction in flow complexity and the flexibility to choose a business model that is most appropriate for their requirements.
“Last year, the nominal value of European government bonds and repos trades cleared by LCH.Clearnet increased by around 30%, and we expect that number to increase further come the end of 2011,” Mr. Ruault concluded.
The bank also expects to extend its memberships onto other CCPs to support increasing client demand and volume growth.
About BNP Paribas
BNP Paribas (www.bnpparibas.com) is one of the strongest banks in the world*. The Group has a presence in more than 80 countries and more than 200,000 employees, including more than 160,000 in Europe. It ranks highly in its three core activities: Retail Banking, Investment Solutions and Corporate & Investment Banking. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail banking model across the Europe-Mediterranean zone and boasts a large network in the western part of the United States. In its Corporate & Investment Banking and Investment Solutions activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas and solid and fast-growing businesses in Asia.
*Rated AA by Standard & Poor's i.e. 3rd rating level on a scale of 22.
About BNP Paribas Securities Services
BNP Paribas Securities Services is a wholly-owned subsidiary of the BNP Paribas Group, delivering flexibility and commitment, backed by the strength of a leading universal bank.
Operating across the investment cycle, we provide post-trade administration solutions to buy-side and sell-side financial institutions and issuers. The Bank has a local presence across 32 countries and global coverage of over 100 markets, offering a one-stop shop for all asset classes, both onshore and offshore, across the globe.
With USD 6,975 billion of assets under custody, USD 1,244 billion assets under administration and more than 6,600 funds administered as at 30 June 2011, BNP Paribas Securities Services is a top five global provider of securities services*.
(*) Source: BNP Paribas securities Services Globalcustody.net competitors' AuC tables.