Eurex Clearing enhances the marketplace for securities lending central clearing

The securities lending business turns gradually into a centrally cleared segment. “The impact of regulation and the increasing cost of capital, combined with the drive for operational efficiency, support central clearing for the securities lending marketplace”, said Erik Müller, who will take over responsibility for Eurex Clearing on 1 July.

The development and implementation of a centrally cleared securities lending solution is part of Deutsche Börse Group’s strategy to incorporate new and innovative offerings that assist members to increase capital efficiencies by maintaining and supporting the bilateral, relationship driven characteristics of the securities lending market. 

Eurex Clearing, along with leading firms from the securities financing markets, has embraced change and innovation to make the Lending CCP a fundamental part of its day-to-day business. Morgan Stanley partnered with Eurex Clearing in late 2014 to enhance and expand the original securities lending clearing offering, and has been actively using the Lending CCP since April 2016.

“Morgan Stanley and Eurex Clearing combined efforts to identify the remaining barriers to broader take-up of central clearing securities lending transactions. This has been a key strategic development in creating a centrally cleared model that is resource-efficient for all participants and allows us to create additional capacity for our clients,” said Susan O’Flynn, Global Head of CCP Strategy, Governance and Optimization at Morgan Stanley. “Following extensive collaboration with our clients, we are now actively trading in a new centrally cleared model that is much closer to bilateral market execution, particularly in post-trade activity.”

About Eurex Clearing

Eurex Clearing, part of Deutsche Börse Group, is one of the leading central counterparties globally – assuring the safety and integrity of markets while providing innovation in risk management, clearing technology and client asset protection. Eurex Clearing provides fully-automated, straight-through post-trade services for derivatives, equities, bonds and secured funding & financing, as well as industry-leading risk management technologies. Eurex Clearing serves 176 clearing members in 17 countries, managing a collateral pool of around EUR 50 billion and processing gross risks valued approx. EUR 16 trillion every month.