CLS has announced that Deutsche Bank, Mashreq and Standard Chartered are at various stages of onboarding to CLSNet, a standardized, automated bilateral payment netting calculation service for approximately 120 currencies. They will join the growing CLSNet community of global and regional banks, which includes seven of the top ten global banks. CLSNet standardizes and centralizes post-trade processes across the global currency spectrum and in doing so reduces risk, enhances efficiency and improves liquidity for a growing network of FX market participants. Using CLSNet also helps FX market participants adhere to the FX Global Code, the industry’s global principles of good practice for the FX market. In particular, using the service supports adherence to Principles 35 and 50, as all trade instructions sent to CLSNet are validated and matched up to the pre-determined cut-off times between counterparties for each currency. This ensures that only matched trade instructions are included in the automated net calculation and that there is a single common record of the net payment obligations. By automating the netting process via a centralized platform, users benefit from greater operational efficiency and increased risk mitigation for currencies that are not currently eligible for CLSSettlement. Lisa Danino-Lewis, Chief Growth Officer, CLS said: “The addition of Deutsche Bank, Mashreq and Standard Chartered demonstrates the appeal of CLSNet to all market participants exploring ways to mitigate settlement risk, reduce operational costs and optimize liquidity for their post-trade FX trading processes. Given the sharp focus on settlement risk mitigation across the industry, CLS is collaborating with market participants to further evolve CLSNet and to facilitate adoption for a wide range of participants.”
