Euronext confirms the expansion of Euronext Clearing to derivatives
markets for Q3 2024
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Euronext confirms the
expansion of Euronext Clearing to derivatives markets for
Q3 2024
Amsterdam, Brussels, Dublin, Lisbon,
Milan, Oslo and Paris – 16
January 2023 – Euronext, the
leading pan-European market infrastructure, today announces that
the European expansion of Euronext Clearing to Euronext derivatives
markets is planned for Q3 2024.
Since April 2021, Euronext has been the owner of
a multi-asset clearing house, Euronext Clearing (formerly
CC&G), and is thus in a position to directly manage its
clearing activities to complete its value chain. In November 2021,
Euronext announced its ambition to internalise the clearing
activity of its cash and derivatives flows, today operated by
third-party providers. As a result Euronext Clearing will become
Euronext’s clearing house (“CCP”) of choice for cash equity1,
listed derivatives and commodities markets.
Combined with the successful migration of its
Core Data Centre in June 2022 from Basildon (United Kingdom) to
Bergamo (Italy) and the planned migration of the Borsa Italiana
capital markets to Optiq®, Euronext’s proprietary trading platform,
the expansion of Euronext Clearing will allow Euronext to manage
the entire trading value chain of its markets by the end of 2024.
Euronext will directly operate clearing activities for its cash,
listed derivatives and commodities markets, and create value
through a harmonised clearing framework across Euronext venues. It
will provide one single platform for clients to access information
on collateral, risk, and clearing. Euronext Clearing will bring
margin efficiencies to clients with the implementation of a new
Value-at-Risk methodology, offering the financial ecosystem with
increasingly efficient and resilient solutions for risk capture and
allocation within the system. This move will also bring
efficiencies across all asset classes, with transparency on data,
particularly on settlement, leveraging Euronext Securities to
access the Target-2-Securities (T2S) settlement platform. Euronext
Clearing will allow Euronext to significantly increase its
footprint in the post-trade space and align strategic priorities
between trading and clearing. Euronext will be in an ideal position
to innovate and improve time-to-market, notably on derivatives
products, to serve the evolving needs of its clients.
Positioning of Euronext
Clearing as the
CCP of choice across its
cash equity markets1
As announced on 3 November 2022, Euronext
confirms the first phase of the expansion of Euronext Clearing with
the expected positioning of Euronext Clearing as the Euronext CCP
of choice for its cash equity markets1 by the end of Q4 2023.
Euronext will continue to offer an open access CCP model for cash
equity clearing.
Migration2
of Euronext listed derivatives and commodities markets to
Euronext Clearing expected in Q3
2024
Euronext confirms it expects to migrate the
listed financial derivatives and commodities markets of Euronext
Amsterdam, Euronext Brussels, Euronext Lisbon, Oslo Børs and
Euronext Paris from LCH SA to Euronext Clearing by Q3 2024. As a
reminder, Euronext Clearing already clears Euronext Milan listed
derivatives.
The migration of Euronext listed derivatives and
commodities markets is the final step of the European expansion of
Euronext Clearing set up as part of Euronext ‘Growth for Impact
2024’ strategic plan. It will unlock innovation capabilities,
notably on derivatives products. Furthermore, the migration will
maximise value extraction through a harmonised clearing framework
across Euronext venues and deliver on the announced targeted
run-rate annual synergies for 2024.
Euronext and LCH SA are committed to working
together to ensure an orderly migration of clearing flows from LCH
SA to Euronext Clearing.
Notification of
early termination of the derivatives
clearing agreement (the “Agreement”)
with LCH SA
As Euronext Clearing undertakes derivatives
clearing services in Europe, Euronext has decided to terminate the
existing Agreement with LCH SA, under the terms of the Agreement.
Therefore, on 16 January 2023, Euronext served LCH SA notice of
termination for the purposes of the Agreement.
As set up in the Agreement, Euronext will pay a
termination fee of approximately €36.03 million to LCH SA, to be
provisioned in its income statement as non-underlying expenses in
Q1 2023, and payable in 2024. It is reminded that this amount is
included in the €150 million of implementation costs related to the
‘Growth for Impact 2024’ strategic plan and already announced in
November 2021.
Following the notification of the early
termination of the Agreement, LCH Group has the option to buy back
Euronext's 11.1% stake in LCH SA. Further communications on the
stake owned by Euronext in LCH SA will be made when
appropriate.
The termination of the Agreement does not impact
the existing clearing agreement signed between MTS S.p.A and LCH SA
nor the existing agreement related to the interoperability link on
Italian Government Bonds between Euronext Clearing and LCH SA4.
Stéphane Boujnah, Chief Executive
Officer and Chairman of the Managing Board of Euronext,
said:
“We are pleased to announce that the migration
of Euronext derivatives clearing activities to Euronext Clearing is
planned for Q3 2024, a few months after the migration of Euronext
cash clearing activities. Combined with the successful migration of
the Core Data Centre to Bergamo in June 2022 and the planned
migration of the Borsa Italiana capital markets to Optiq® in 2023,
the expansion of our clearing activities is a major step towards
the delivery our “Growth for Impact 2024” strategic plan. This will
significantly contribute to achieve the €100 million 2024 targeted
run-rate annual synergies related to the Borsa Italiana Group
acquisition.
Euronext has profoundly transformed itself over
the past five years and is uniquely positioned to become the
leading European market infrastructure. Euronext is now the leading
listing venue and the largest liquidity pool in Europe, thanks to
its single trading platform. The expansion of Euronext Clearing to
Euronext markets is another significant transformational milestone,
allowing Euronext to manage the entire trading value chain, and
become a major player in the post-trade space.
We look forward to completing these strategic
milestones in the coming months. I would like to thank all the
Euronext teams that have already been working on these key projects
for more than a year and that will be critical to the delivery of
these projects. I would like to thank LCH SA for the great
collaboration during the past years.”
CONTACT ANALYSTS & INVESTORS
– ir@euronext.com |
Aurélie
Cohen |
+33 1 70 48 24
27 |
ir@euronext.com |
Clément
Kubiak |
+33 1 70 48 26
33 |
ir@euronext.com |
CONTACTS MEDIA –
mediateam@euronext.com |
Aurélie Cohen
(Europe) |
+33 1 70 48 24
45 |
parispressoffice@euronext.com |
Marianne Aalders
(Amsterdam) |
+31 20 721 41
33 |
maalders@euronext.com |
Pascal Brabant
(Brussels) |
+32 2 620 15
50 |
pbrabant@euronext.com |
Sandra Machado
(Lisbon) |
+351 210 600
614 |
smachado@euronext.com |
Andrea Monzani
(Europe/Milan/Rome) |
+39 02 72 42 62
13 |
Italypressoffice@euronext.com |
Cathrine Lorvik
Segerlund (Oslo) |
+47 41 69 59
10 |
clsegerlund@euronext.com |
Sarah Mound
(Paris/Dublin) |
+33 1 70 48 24
45 |
parispressoffice@euronext.com |
About Euronext
Euronext is the leading pan-European market
infrastructure, connecting European economies to global capital
markets, to accelerate innovation and sustainable growth. It
operates regulated exchanges in Belgium, France, Ireland, Italy,
the Netherlands, Norway and Portugal. With close to 1,930 listed
equity issuers and around €6.3 trillion in market capitalisation as
of end December 2022, it has an unmatched blue chip franchise and a
strong diverse domestic and international client base. Euronext
operates regulated and transparent equity and derivatives markets,
one of Europe’s leading electronic fixed income trading markets and
is the largest centre for debt and funds listings in the world. Its
total product offering includes Equities, FX, Exchange Traded
Funds, Warrants & Certificates, Bonds, Derivatives, Commodities
and Indices. The Group provides a multi-asset clearing house
through Euronext Clearing, and custody and settlement services
through Euronext Securities central securities depositories in
Denmark, Italy, Norway and Portugal. Euronext also leverages its
expertise in running markets by providing technology and managed
services to third parties. In addition to its main regulated
market, it also operates a number of junior markets, simplifying
access to listing for SMEs.
For the latest news, go to euronext.com or
follow us on Twitter (twitter.com/euronext) and LinkedIn
(linkedin.com/euronext).
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1 Excluding Oslo Børs cash markets2 Migrations are subject to
the declaration of non-objection of relevant regulators3 Of which
€6 million to be adjusted for inflation impact4 For more
information, please refer to Euronext 2021 Universal Registration
Document – Section 7.2.1, Material Contracts
- 20220116_Euronext Clearing_VF
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