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Goldman Sachs joins CLS, IHS Markit cross-currency swaps service

By Sunniva Kolostyak

June 11, 2020

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Investment bank Goldman Sachs has joined a cross-currency swaps service from CLS and IHS Markit, becoming the eighth settlement member live on the service.

CLS, which is a market infrastructure group delivering settlement, processing and data solutions, has created the service with IHS Markit, the critical information, analytics and solutions provider.

As an extension of CLS’s payment-versus-payment (PvP) settlement service, it utilises trade confirmation platform MarkitSERV.

Commenting on joining the service, Richard Chambers, Global Head of Short Macro Trading at Goldman Sachs, said: “Becoming a participant of the cross-currency swap service provided by CLS and IHS Markit helps us to further mitigate settlement risk, and we expect to see further operational and funding efficiency benefits as more counterparties join the service.”

The cross-currency swap service allows CLSSettlement members to send their swaps into the service for settlement. The swap flows are multilaterally netted against all other FX transactions in CLSSettlement, resulting in a significant reduction in daily funding requirements for clients and liquidity optimisation benefits across the industry.

Keith Tippell, Head of Product at CLS, said: “We are delighted to welcome Goldman Sachs as the latest participant in our cross-currency swaps settlement service. Demand has never been higher from market participants for risk mitigation, liquidity optimisation and post-trade efficiency.

“Further, this demonstrates the benefits we can deliver to our clients by leveraging our unique position as a financial market infrastructure in the FX marketplace and collaborating with established service providers that share the same client base, such as IHS Markit,” Tippell added.

Also commenting, Chris Jackson, Managing Director at IHS Markit, said: “Our collaboration with CLS is a powerful example of service providers working together to make the swaps market more efficient. As the community of global financial institutions connected by the MarkitSERV network continues to grow, the addition of Goldman Sachs to the cross-currency swaps settlement service demonstrates the industry’s ongoing support for such initiatives.”

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