Euroclear Bank and Standard Chartered Broaden Collateral Pool
Euroclear Bank announced that assets for mutual clients held at Standard Chartered will now be available for use as collateral – via Euroclear’s global ‘Collateral Highway’ – to meet collateral requirements in triparty deals managed by Euroclear Bank.
Standard Chartered is the first Asia-based agent bank to join the Collateral Highway, which means all equity and fixed-income securities held within the Standard Chartered custody network can potentially become eligible assets to be used as collateral when Euroclear Bank serves as the triparty agent.
As a result, clients will be able to broaden the pools of collateral available to secure exposures arising from various types of transactions, improving interoperability and choice as to how they can finance their assets. Standard Chartered will continue to hold the assets as custodian while the securities move across markets and time zones via Euroclear’s Collateral Highway. These assets may be transported as collateral to cover exposures arising from, for example, repos, loans, derivatives and central counterparty (CCP) margins, as well as for access to central bank liquidity.
“The agreement with Standard Chartered to make assets in their network available to the Collateral Highway will ease cross-border financing,” said Olivier Grimonpont, general manager and region head, Asia-Pacific, of Euroclear Bank.
“Euroclear Bank is active in collateralising many types of transactions, including cross-border renminbi (RMB) repo deals. Access to assets held by Standard Chartered to collateralise these transactions will open the market even further. We are delighted to be partnering with Standard Chartered to add a triparty dimension to their collateral management service offering and to offer even deeper pools of liquidity to our mutual clients.”
Alan Naughton, global product head of investors and intermediaries, transaction banking, Standard Chartered, added: “This partnership positions us as the first bank in Asia to offer mutual clients of Standard Chartered and Euroclear Bank the opportunity to mobilise their securities inventory through the collateralising of global exposures from a single collateral pool.”