BNY Mellon and ING Join CLSNet for Enhanced FX Services

BNY Mellon and ING have announced their participation in CLS’s bilateral payment netting calculation service, CLSNet. The move positions them as the latest additions to the growing CLSNet community, which already boasts eight of the top 10 global banks as participants.

CLSNet serves as a standardized and centralized platform for post-trade processes, covering a diverse range of trade types, including same-day trades and non-deliverable forwards (NDFs). This approach not only reduces risk but also enhances operational efficiency across a wide spectrum of currency flows. The focus on settlement risk in the FX market, particularly in emerging market currencies and other expanding segments, has prompted participants to seek effective risk mitigation strategies through automated post-trade services like CLSNet.

The platform has witnessed record growth throughout the year, underscoring the industry’s overwhelming support for its services. The average daily notional value of net calculations in CLSNet consistently exceeded USD 115 billion in the past 12 months. On December 20, 2023, the platform achieved a landmark daily notional of USD 445 billion netted.

BNY Mellon and ING Join CLSNet for Enhanced FX Post-Trade Services

Also, Lisa Danino-Lewis, Chief Growth Officer at CLS, expressed her delight at the inclusion of BNY Mellon and ING in the CLSNet community. She highlighted the benefits these institutions would gain, including risk mitigation, operational efficiencies, and liquidity advantages. Furthermore, Danino-Lewis emphasized that CLSNet’s accessibility to various market participants, including funds, corporates, and non-bank financial institutions, makes its advantages widely available across the FX industry.

Jason Vitale, Head of Global Markets Trading at BNY Mellon, stated that joining CLSNet would allow them to enhance their clients’ experience by providing improvements in intraday liquidity and execution efficiency.

Robbert Zee, FM Operations Lead at ING, emphasized CLSNet’s ability to strengthen and standardize post-trade processes globally. As the largest Dutch bank with significant global operations, ING sees its participation in CLSNet as integral to improving operational efficiency and reducing risk for currencies not currently eligible for CLSSettlement.

Moreover, CLSNet supports FX market participants’ adherence to the updated FX Global Code, particularly Principles 35 and 50. All trade instructions sent to CLSNet undergo validation and matching up to pre-determined cut-off times between counterparties for each currency. This ensures that only matched trade instructions are included in the automated net calculation, providing a single common record of net payment obligations. By automating the netting process through a centralized platform, users benefit from enhanced operational efficiency and increased risk mitigation for currencies not currently eligible for CLSSettlement.

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