SWIFT Case Study Looks at Clearstream’s Use of Standards to Achieve Interoperability

Clearstream’s new generation of processing environment has realised its interoperability strategy with less complexity, faster time to market, no migration costs and lower project costs by leveraging its commitment to SWIFT connectivity and ISO standards, according to a SWIFT case study1.

Clearstream’s new generation processing environment meets market demand for improved efficiency in cross-border settlement and custody processing. For Clearstream an optimised internal environment coupled with ISO 15022 real-time messaging delivers, via an interoperability strategy, the same high service levels that can be achieved through an integration approach - but to all markets, rather than to a limited set.

The achievement of Clearstream’s interoperability by taking advantage of SWIFT standards delivers benefits that go beyond settlement. Additionally Clearstream customers have a more efficient use of collateral and improved asset servicing.

Philip Brown, Head of Client Relations Europe and Americas and Member of the Executive Board of Clearstream International, said: “Interoperability is the key word for today’s financial markets, which can only be achieved via industry standards like ISO 15022. With the problems financial institutions faced recently, interoperability is essential because effective interoperability makes it possible to move collateral on a same-day basis between multiple locations and meet funding requirements.”

Alain Raes, Head of SWIFT EMEA, says: “We are delighted that Clearstream recognised the value of SWIFT and ISO standards and has leveraged its earlier investment in the CreationConnect connectivity suite to support the introduction of its new environment and its interoperability strategy.”

Clearstream re-engineered its internal settlement to deliver fully optimised settlement in real-time from 4.00 to 18.00 CET. Permanent optimisation ensures a consistent quality of settlement feedback after consideration of all cash and securities netting opportunities, allowing flexibility to set domestic market instruction input deadlines as and when required.  Clearstream’s model supports a turnaround time – receipt of an instruction, internal provisioning, validation and settlement in the local market - of 15 minutes. This allows instruction input deadlines to be 15 minutes prior to the local market deadline. Since its launch in March 2008, Clearstream has improved more than 100 domestic market deadlines across 36 markets, extended Bridge input deadlines, introduced a new free of payment Bridge deadline and increased the number of matching and settlement exchanges with Euroclear Bank.

The case study is available on request and will be presented at SIBOS in Vienna on Wednesday, September 17 at 10h30