Eurex Clearing, a clearing house of Deutsche Börse Group, has now joined forces with Dutch pension fund PGGM. The pension fund will be Eurex’ first buyside client to become a direct participant of the firms’ Securities Lending central counterparty (CCP).
Securities lending platform EquiLend has been selected to provide connectivity services to Eurex Clearing’s Lending CCP.
Roelof van der Struik, investment manager Treasury Trading & Commodities at PGGM comments: “At PGGM, we believe by connecting to Eurex Clearing, using the full capabilities of EquiLend, the CCP model enables new stock lending structures and business opportunities for beneficial owners as well as helping to manage the rising burden of balance sheet regulation and costs for the securities lending market.”
Brian Lamb, CEO of EquiLend comments : “The focus on CCP solutions continues to increase, driven by the need for cost and operational efficiencies. We anticipate greater utilisation of our link to Eurex as the securities finance industry looks to realise the benefits of a CCP model.”
Eurex Clearing’s Lending CCP covers loans in equities and exchange-traded funds in Europe as well as fixed income securities. The provider aims to deliver capital efficiency and reduce counterparty risk exposure by providing direct CCP access through its specific lender license. The group also states that its programme eliminates the risk for multiple credit evaluations.
Eurex Clearing currently serves 176 clearing members in 17 countries, managing a collateral pool of around €50bn and processing gross risks valued at approx. €16trn every month.
PGGM currently has about €206bn in assets and is the second largest pension scheme in the Netherlands.