2007'04.18.Wed
DTCC's European Subsidiary Chosen as Clearance and Settlement Provider for Project Turquoise
April 18, 2007
Citi's Global Transaction Services to Serve as EuroCCP's Settlement Agent LONDON, April 18 /Xinhua-PRNewswire/ -- The Depository Trust & Clearing Corporation, a leading provider of clearance, settlement and information services, announced today that its EuroCCP subsidiary has been selected to provide a clearance and settlement solution for Turquoise. Turquoise is a consortium of seven major financial institutions that are working to develop a new pan-European trading platform. EuroCCP will provide all clearing, settlement and risk management services to Turquoise. Citi's global transaction services business will serve as EuroCCP settlement agent. This partnership recognizes Citi's extensive pan-European securities network and its strong links with the European central securities depositories. This decision follows a request for proposal (RFP) process that has been under way for a number of months and involved a rigorous review of proposed alternative post-trade solutions. DTCC has a well-earned reputation for certainty and reliability, and more than 30 years experience in clearing and settling virtually all equity and fixed income trading in the U.S. Last year, DTCC cleared and settled more than US$1.5 quadrillion in securities transactions. In addition, they provide post-trade services to the OTC derivatives market on a global basis. EuroCCP will build upon DTCC's extensive experience and technology know-how as a central counterparty (CCP). "We are delighted that EuroCCP has been selected to support Turquoise," said Donald F. Donahue, DTCC president and CEO. "We have a long history of providing clearing and settlement solutions across the industry and a strong track record of helping customers lower transaction costs, reduce risk and improve efficiency. Over the coming months, we will be working very closely with Turquoise and we're confident that we can deliver this highly scalable, central counterparty platform within the timeframes required." "DTCC is well-known in the global financial services market, and they presented a well-thought out proposal to the consortium," said a Turquoise spokesperson. "The face of financial services is becoming much more global in nature, and as old barriers break down in Europe under MiFID and other directives, the landscape is becoming much more competitive. We believe EuroCCP and Citi's global transaction services business will help Turquoise to succeed as a new, low-cost, pan-European platform that can build the necessary liquidity to make it a major contender against existing trading venues." "We are very pleased to partner with EuroCCP as settlement agent for Turquoise," said Clive Triance, Chief Operating Officer for Securities and Fund Services, Europe, Middle East, and Africa at Citi. "Citi has settlement capabilities in over 80 markets globally, including all the European markets covered by Turquoise. Our established relationships with the European central securities depositories will ensure local settlement efficiency. We look forward to working with EuroCCP in supporting this exciting new trading venue." How the new platform will work EuroCCP will accept trades from the Turquoise trading platform and these trades will then be netted on trade date. EuroCCP will guarantee trades upon receipt and validation. For all trading members of Turquoise that are not clearing members of EuroCCP, these trades will be handled through general clearing member relationships. EuroCCP will apply risk-based margining, with appropriate levels of margin collected on a daily basis. Any unsettled obligations will be marked-to-market each day. Citi's global transaction services business will process EuroCCP's settlement instructions for delivering and receiving securities and related payments in various currencies through its local securities network. EuroCCP will be a UK Recognised Clearing House (RCH), headquartered in London. DTCC is in the process of filing an application with the Financial Services Authority (FSA) to receive such recognition in time for the Turquoise launch date. EuroCCP will be operated on an "at-cost" basis, and any excess revenues collected beyond the cost to support the operation will be refunded to participant members. The seven investment banks behind Turquoise are Credit Suisse, Deutsche Bank, Goldman Sachs, Morgan Stanley, Merrill Lynch, Citi and UBS, who together generate around half of Europe's equity order traffic. About DTCC The Depository Trust & Clearing Corporation (DTCC), through its subsidiaries, provides clearance, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities and over-the-counter derivatives. In addition, DTCC is a leading processor of mutual funds and insurance transactions, linking funds and carriers with their distribution networks. DTCC's depository provides custody and asset servicing for 2.8 million securities issues from the United States and 100 other countries and territories, valued at $36 trillion. Last year, DTCC settled more than US$1.5 quadrillion in securities transactions. DTCC Has operating facilities in multiple locations in the United States and overseas. For more information on DTCC, visit http://www.dtcc.com . About Citi Citi, the leading global financial services company, has some 200 million customer accounts and does business in more than 100 countries, providing consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage and wealth management. Citi's major brand names include: Citibank, CitiFinancial, Primerica, Citi Smith Barney and Banamex. Additional information may be found at http://www.citigroup.com or http://www.citi.com . For more information, please contact: Stuart Z. Goldstein of DTCC Tel: +1-212-855-5470 or +1-609-203-5220 Email: sgoldstein@dtcc.com Patrick Donovan of Citigate Dewe Rogerson Tel: +44-20-7282-2915 Email: patrick.donovan@citigatedr.co.uk Jeanette Volpi of Citi Tel: +44-20-7986-2809 Email: jeanette.volpi@citigroup.com
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