FRANKFURT Jan 16 Five stock exchanges are
setting up a cooperation to improve collateral management and
liquidity services to customers, allowing them to offer
collateral in one country via assets held in other jurisdictions
or currency areas.
Luxembourg-based Clearstream, Spain's Iberclear,
Australia's ASX, Brazil's Cetip and South
Africa's Strate will be initial members of the Liquidity
Alliance, the bourses said in a joint statement on Wednesday.
It is open for new members to join.
"Optimising collateral means creating and utilising the
widest possible collateral pools without jeopardising individual
and country specific requirements," Clearstream Stefan Lepp
The global movement of banks' collateral is often hampered
by regulatory requirements to manage assets under local laws or
in local currency, and not to transfer them overseas.
The situation has worsened since the euro zone crisis
knocked money markets, curtailing unsecured lending. At the same
time, new regulation forces banks to hold more liquidity.
(Reporting by Arno Schuetze)