CLS and Quandl, a data platform for economic and financial data, have made standardised and aggregated FX trade reports available via subscription.
This new service will allow CLS to distribute its set of executed trade data to the broader market ...
CLS Group (CLS) has introduced two new membership models, affiliated settlement and non-shareholder settlement.
These two new categories will exist alongside the existing shareholder and central bank settlement membership categories.
The affiliated settlement membership category allows institutions to have more than one entity within a corporate group become a settlement member. This category is aimed at institutions seeking to segregate their FX businesses to manage their own CLS participation and correspondent banking relationships.
It also removes the reliance on internal clearing and intergroup limits, helps settlement members meet their regulatory ring-fencing obligations and facilitates recovery and resolution planning.
Profit & Loss talks to David Puth, CEO of CLS and Chairman of the Market Participants Group (MPG), about how the FX Global Code of Conduct will work.
Profit & Loss: What was the process like to develop the Code from start to finish? Were there challenges in achieving consensus amongst so many different market participants?
David Puth: The development of the Code has generally been a constructive process. The committees involved in its creation are: the FX Working Group (FXWG), which is the central bank working group; the Market Participants Group (MPG), which is the group that I chair; and a number of industry groups, including regional FX committees.
The FX Global Code is in many ways as “strong as any rule, any regulation or frankly any law could put in place”, David Puth, chair of the Market Participants Group and CEO of CLS, claims.
Speaking to Profit & Loss on the sidelines of a press conference to launch the complete FX Global Code, Puth addressed the key question of just how much teeth an essentially voluntary set of principles can have, noting that while it may not stop misconduct it sets a very high standard of expected behaviour.
CLS Group plans to launch a same-day settlement service in the second half of 2018, subject to regulatory approvals.
The new service, CLSNow, will offer bilateral, same-day, payment-versus-payment gross settlement in CAD, CHF, EUR, GBP and USD, with plans to extend the service to additional currencies in the future, based on client demand. The aim is to enable counterparties to optimise the use of available liquidity in the same-day market, while mitigating settlement risk.
Currently, some of CLS’s largest clients have in excess of 10% of their daily euro business being transacted on a same-day basis, and the expectation is that the launch of CLSNow will further facilitate the growth of this same-day market.
David Puth, Vice Chair of the Global FX Committee (GFXC), will be completing his term in this role with the group he helped form next month.
Puth, who is the CEO of CLS Group, has been heavily involved in the creation of the Global Code, the first iteration of which was released in May 2016, and then published in its final form in May 2017. Firms were anticipated to commit adherence by around the one-year anniversary in May.
When work on the Global Code first began, it was in the form of a public/private sector partnership, with Puth leading the private sector side through the Market Participants Group (MPG), which worked together, but separately, with the public sector side, led by the Reserve Bank of Australia’s Deputy Governor Guy Debelle.
David Puth is stepping down as the CEO of CLS after leading the company since 2012.
Chairman Kenneth Harvey will act as interim CEO until a successor is named. Puth will remain with CLS through 30 November to ensure a smooth transition.
While Harvey serves as interim CEO, CLS independent director Bryan Osmar and director Rick Sears will assume the responsibilities of chairmen of the board of CLS Group Holdings and CLS Bank International. CLS has retained an executive search firm and is evaluating candidates for the CEO role.