Posted May 6, 2006
EuroCCP and LCH.Clearnet will support trading of European stocks offered
on SmartPool, acting as central counterparties, enabling anonymous
post-trade processing, providing netting and offering a full range of
risk management services. EuroCCP will use Citi’s global transaction
services business as its settlement agent. Citi will handle settlements
in respective central securities depositories (CSDs) for trades.
“We believe as we extend EuroCCP’s reach to a broader population of
European trading platforms such as SmartPool, all financial firms — and
end investors — will benefit from the economies of scale that come from
increased volumes that clear and settle through our platform,” says
Diana Chan, Chief Executive Officer of Euro CCP.
LCH.Clearnet will clear stocks listed in the Euronext markets,
Amsterdam, Brussels, Lisbon and Paris, with settlement provided by local
CSDs. “This agreement underlines our desire and capacity to clear new
markets and to respond to new initiatives introduced by the Markets in
Financial Instruments Directive (MiFID),” says Christophe Hémon, Chief
Executive Officer of LCH.Clearnet. “Our clients will enjoy substantial
economies as we will set up offsetting at risk and settlement levels
between SmartPool and Euronext’s markets.”
As a new multi-lateral trading facility, SmartPool provides a dark pool
for execution of large institutional order flow of stocks from 14
European countries. The partnerships are intended to support SmartPool’s
efforts to deliver a trading platform later this year, pending
regulatory approval.
“SmartPool’s unique ‘open’ business model, whereby we have agreements with two clearing providers, enables us to offer our future customers the most appropriate, competitive and attractive services and environment for the trading of European stocks,” says Roland Bellegarde, Head of European Cash Markets at NYSE Euronext.