Morgan Stanley is to become a clearing member of the Eurex Clearing’s Securities Lending CCP.
Both partners aim to have finalised the process by the end of October.
“Morgan Stanley is supportive of CCP solutions for securities lending such as the Eurex Clearing model as it allows us to preserve our client relationships and deliver best execution with risk, resource and operational efficiencies. Tiered membership plays a critical part in facilitating buy-side participation through different forms such as the Specific Lender License,” says Susan O’Flynn, managing director, global head of CCP strategy and optimisation, Morgan Stanley.
“We are very pleased that Morgan Stanley as a global leader and pioneer in financial markets has decided to use our Lending CCP. This confirms the strong value proposition of our clearing service for bilaterally agreed securities lending transactions. We are looking forward to further develop our relationship and enhance our service offering in close cooperation with major market participants,” says Matthias Graulich, chief client officer and member of the Eurex Clearing executive board.
Eurex Clearing’s Securities Lending CCP was launched in November 2012. It brings the benefits of central clearing to a significant and so far largely bilateral market segment. The current product scope includes equities from Belgium, France, Germany, the Netherlands and Switzerland as well as a wide range of international fixed-income instruments and exchange-traded funds. The clearing service reduces counterparty risk and provides significant cost benefits to market participants with increasing capital requirements for bilateral exposures.
Four clearing members have already been admitted to the service and have cleared first transactions. Further market participants are in the admission and on-boarding process.