Agreement creates a single collateral pool.
BNP Paribas Securities Services and Clearstream have signed a letter of intent to intensify their cooperation on collateral management.
Clearstream has introduced its new service for agent banks, Liquidity Hub Connect, which will allow BNP Paribas customers to cover exposures from a single pool of collateral. Client portfolios will remain with BNP Paribas' custody network, while Clearstream's engine automatically allocates, optimizes and substitutes collateral across the bank's book.
"We are committed to providing our clients with maximum flexibility to manage their collateral requirements across key markets while delivering bespoke domestic and global settlement and custody services," says Alain Pochet, head of clearing, settlement and custody at BNP Paribas Securities Services. "Strategic partnerships, such as this first one with Clearstream, complement perfectly our collateral management offer as bilateral agent for buy side and sell side institutions."