Clearstream has launched a new borrowing and lending programme that puts German federal securities at the disposal of market participants without a lending fee from late in the afternoon until early in the morning.
Clearstream parent Deutsche Börse describes the programme, called BAMBL (Bond Advanced Management for Borrowing and Lending ), as the first building block in a comprehensive series of services that the group is developing to improve the settlement of cross-border transactions.
As an additional element, Eurex Clearing, the group's clearing organisation, will operate as an automatic borrower for Eurex bonds and repo trades in the Euroclear settlement system as of the third quarter 2003.
The German exchange says the measures should increase the settlement ratio for cross-border transactions during the night-time processing cycle and contribute to the improvement of the interoperability of settlement systems.
Intraday lending fees in BAMBL will only be incurred if the borrowed securites are not returned until after the first daytime processing cycle.