Deutsche Börse increases security and efficiency in German government bond trading on Xetra

2 May 2012

More than 60 bonds to be included in settlement via Eurex Clearing from 2 May

With effect from 2 May, Eurex Clearing will act as the central counterparty (CCP) for the settlement of trades in more than 60 German government bonds on Xetra. This means that counterparty risk will be reduced for all trading participants and efficiency further improved. As an incentive to all participants, Eurex Clearing will not be charging clearing fees for these bonds for the remainder of the year.

“The inclusion of German government bonds in the CCP is an important step in making exchange trading via Xetra Frankfurt Specialist even more attractive and secure,” said Rainer Riess, Managing Director of Xetra Market Development at Deutsche Börse. “Investor security and protection regarding government bonds is now even better addressed in clearing and settlement thanks to a seamless, efficient and secure process chain.”

The CCP acts as counterparty in transactions between buyers and sellers. The participants themselves remain anonymous, but post appropriate collateral for their open positions. In addition, processing efficiency is increased by the multilateral netting of amounts due to and from participants and standardised processes for post-trading services.

Deutsche Börse's introduction of Eurex Clearing as the central counterparty for the Xetra electronic system started in 2003 and has taken place in stages, including ongoing expansion of the instrument groups supported in central clearing. Following the transfer of floor trading to Xetra last year, additional segments are now being gradually included. Around 900,000 securities are currently tradable on Xetra, including 23,000 bonds. The Xetra network with around 240 participants in 18 countries ensures the highest level of liquidity.

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