Hong Kong and Brussels, 25 November 2002 - The direct link from the HKMA's Central Moneymarkets Unit (CMU) to Euroclear, the Brussels-based international central securities depository, commences live operation today.
The fully automated, real-time CMU link to Euroclear enables Asian investors to hold and settle international debt securities through their CMU accounts. This new link significantly improves the access of Asian investors to international securities and counterparties in a secure, DVP (delivery-versus-payment) environment. Such efficient, cost-effective and low-risk settlement of cross-border securities transactions also enables Asian investors to better manage their liquidity. This development is expected to enhance Hong Kong's role as a securities settlement hub in the region.
This new service supplements the existing link from Euroclear to the CMU, established in 1994, which enables Euroclear's clients to settle debt securities lodged with the CMU.
Commenting on the implementation of the link, Joseph Yam, Chief Executive of the HKMA, said: "This new link is an important addition to Hong Kong's financial infrastructure. It offers a highly efficient channel through which investors in Hong Kong and the region can access the huge pool of international securities lodged in Euroclear. It also provides further support to Hong Kong's role as an investment and fund management centre."
Commenting on the on-time development of the link, Pierre Francotte, Chief Executive Officer of Euroclear Bank, said: "This link demonstrates our commitment to the Asian market by making it easier and less costly for Asian investors to settle a wide range of foreign securities in their own time zones, while offering access to an even broader range of trading counterparties to our clients."
Background information about the HKMA and Euroclear:
HKMA
The Hong Kong Monetary Authority is Hong Kong's government authority responsible for maintaining monetary and banking stability, managing Hong Kong's official reserve and developing Hong Kong's financial infrastructure. The HKMA operates the CMU, which serves as an electronic depositary for debt instruments and provides related settlement facilities. These services are available to issuers and investors in Hong Kong and further afield, and for debt securities denominated in Hong Kong dollars or other currencies. The value of total overseas holdings in the CMU is HK$19.0 billion (EUR2.4 billion).
Euroclear
Euroclear is the world's largest settlement system for domestic and international securities transactions, covering bonds, equities and investment funds. Market owned and market governed, Euroclear provides securities services to major financial institutions located in more than 80 countries. Euroclear also acts as the central securities depository for all Dutch, French, Irish and UK securities, a role that will soon be extended to include all Belgian securities.
For further enquiries, please contact:
HKMA
Thomas Chan, Senior Manager (Press) at (852) 2878 1480 or
Jasmin Fung, Manager (Press) at (852) 2878 8246
Euroclear
Denis Peters, Corporate Communications Director at (+32 2) 224 2618
Conor Leeson, Corporate Communications Manager at (+32 2) 224 2085
Hong Kong Monetary Authority
Euroclear Bank
25 November 2002
