State Street Executes First Centrally-Cleared Repo Trade at Eurex
Posted by Colin Lambert. Last updated: May 12, 2023
State Street has executed its first centrally-cleared repo transactions on Eurex, marking this as the first clearing house outside the US the bank has used to trade and centrally clear repo transactions.
State Street has joined Eurex through its German subsidiary, State Street Bank International GmbH (SSBI). Through its Eurex membership, State Street will be able to expand its European franchise and service offering, Eurex says.
“The opportunities in the European repo market are immense and Eurex is excited to facilitate SSBI’s growth with our centrally cleared and innovative offerings,” says Frank Gast, member of the management board of Eurex Repo.
Travis Keltner, global head of repo and alternative financing solutions at State Street, adds, “Eurex’s ample access to stable market liquidity significantly enhances State Street’s liquidity tool kit. With this membership, State Street can build upon the launch of this Eurex clearing foundation to further support our clients’ needs especially in capital efficient trading and clearing.”
With the current market environment of increasing interest rates, TLTRO repayments, and further reduction of excess liquidity, Eurex says it is seeing a significant increase in trading activities and reaching new record volumes in its cleared repo markets. During the first four months, total traded volume across all markets increased by about 120% compared to the same period in 2022, thereof 37% in the repo market and about 340% in GC Pooling. Just looking at the buy side, Eurex says the total traded volume tripled during the same period year-on-year.