Eurex Clearing partners with Pirum for its upcoming CCP service for securities lending market

Eurex Clearing partners with Pirum for its upcoming CCP service for securities lending market

23.04.12

Eurex Clearing and Pirum Systems sign Connectivity Agreement to facilitate access to Eurex Clearing’s Lending CCP/ Market participants will be able to leverage Pirum’s automation platform to transmit bilaterally negotiated transactions to Eurex Clearing.

Eurex Clearing, Europe’s leading clearing house (www.eurexclearing.com), and Pirum Systems announced today that they have entered into a Connectivity Agreement to facilitate access to Eurex Clearing’s upcoming CCP service for securities lending. Pirum Systems is an acknowledged market leader in automating post-trade processes for the securities finance industry. The direct connectivity between Eurex Clearing and Pirum’s automation platform allows market participants to make use of their existing Pirum interfaces to feed bilaterally agreed transactions to Eurex Clearing for CCP novation and downstream processing.

“We are very pleased to work with Pirum in our effort to bring the safety and efficiency of Eurex Clearing’s CCP services to the securities lending market.

Leveraging Pirum’s existing connectivity will significantly simplify access to our new service and will directly benefit our customers,” said Thomas Book, member of the Eurex Executive Board, responsible for clearing.

“This partnership will enable our extensive customer base to make use of their connectivity with Pirum to use Eurex Clearing’s new and innovative securities lending CCP Service. Pirum’s solution will offer seamless integration for CCP transactions using the same business processes and system interfaces that are already used for bilateral transactions,” said Rupert Perry, CEO of Pirum Systems.

Eurex Clearing is currently in preparation for the mid-year launch of its new Lending CCP Service and thereby will be the first to offer the safety and efficiency of central clearing to the large bilateral-organised securities lending market. Fully introduced, it will cover European markets for loans in equities, ETFs as well as fixed income securities and will provide significant improvements to the current market structure. The clearing house as single counterparty to all trades will reduce counterparty risk exposure and eliminate the need for multiple credit evaluations. Thus, users can achieve a significant reduction in capital allocation associated with bilateral transactions. In addition, the new service is able to support the existing relationship between agent lenders and beneficial owners by introducing a unique member model for beneficial owners. Eurex Clearing also intends to further expand the range of its Lending CCP Service by leveraging internal solutions.