The Euroclear group reported another year of robust operating results in 2014, having reached the EUR 26 trillion mark for client assets held in safekeeping, as well as reporting an all-time high of EUR 633.6 trillion in the value of securities processed. Such historic records reinforce Euroclear’s pre-eminent role as the trusted provider of open post-trade infrastructure, market safety and operating efficiency.
The key operating results for the group in 2014 include:
- The value of securities held on behalf of Euroclear clients grew by 7.4% to a record EUR 26 trillion
- Turnover, the value of securities transactions settled, was a record EUR 633.6 trillion; a 10.6% increase over prior year
- The number of netted transactions settled in the Euroclear group grew by 6.6% to a record EUR 181.6 million
- Euroclear’s Collateral Highway mobilised an average of EUR 883.1 billion of collateralised transactions daily; a 12.1% increase over prior year
- The value of funds serviced by FundSettle increased 18% over prior year, and the volume of fund transactions processed by the group grew 13% to reach 20 million
- Fund orders routed through Euroclear UK & Ireland's EMX Message System increased by 33% to a record 65 million messages in this period
Tim Howell, Chief Executive Officer of the Euroclear group, said: “Euroclear remains a leading market infrastructure that is relevant, reliable, resilient and profit moderated. Our performance over 2014 strengthens Euroclear’s pre-eminent role within the global post-trade ecosystem, and we remain well-positioned for future growth opportunities both in Europe and around the world. We want to thank our clients for the business they entrust with us, and we look forward to working together again in the year ahead.”
He added: “We remain focused on maintaining market stability, delivering the regulation-driven initiatives in our core European franchise and investing in capabilities and services that extend client value.”
Building on the historic relationship between Euroclear and the Euronext markets, the group acquired a stake in Euronext as part of a group of Reference Shareholders in June 2014. The investment provides the group closer proximity to its user community, strengthening its Euroclear Settlement for Euronext-zone Securities (ESES) franchise, and its future in delivering Issuer and Investor CSD services.
Further progress was made in Euroclear’s adoption of TARGET2-Securities (T2S), the European Central Bank’s common settlement platform for euro-denominated CSDs. In late 2014, the group began T2S testing, which is proceeding as expected. Euroclear remains committed to making the transition to T2S as straightforward as possible for its clients, giving them flexibility of access to all T2S markets via Euroclear Bank or the national CSDs.
Following its earlier agreement with the Depository Trust & Clearing Corporation (DTCC), the joint venture company DTCC-Euroclear Global Collateral Limited was launched in September 2014. Building on Euroclear’s leadership position in collateral management, the joint venture will deliver unprecedented operating efficiencies to market participants and improve the stability and soundness of financial markets. Over the past year, Euroclear also continued to both expand the range and involvement of market participants connected to the Collateral Highway, helping to ease collateral sourcing and mobilisation while providing improved transparency and asset protection for all participants on a global basis.
Euroclear also made further progress with its international ETF structure, launched in 2013 with inaugural issuer BlackRock. In 2014, Pimco and State Street adopted Euroclear’s international ETF structure, with ETF listings on Euronext and the London Stock Exchange, benefitting from a single European settlement location to improve trading liquidity, improve cross-border processing efficiencies and help lower investors’ overall transaction costs.
Elsewhere, Euroclear made further progress in strengthening its franchise around the world, with continued success in bringing ‘Euroclearability’ to domestic capital markets that might otherwise have limited access to global participants. Over 2014, the group made Panamanian government bonds; Mexican corporate bonds; Russian municipal and corporate bonds, as well as equities; and Taiwanese-issued RMB bonds available for settlement via Euroclear’s links to their respective domestic CSDs.