Sumitomo Chemical Joins CLS Settlement

Japanese corporate Sumitomo Chemical Company has joined CLS  Settlement as a third-part participant.

The company is settling its FX transactions via its third-party service provider, Sumitomo Mitsui Banking Corporation (SMBC). It is also the first CLS Settlement participant using the London Stock Exchange Group (LSEG)’s Refinitiv FXall Settlement Center platform in Japan, which has the ability to generate Swift messages to SMBC for FX instruction submission to CLS.

CLS says the move “highlights the continued growth in CLS Settlement third-party participation in Japan, especially among corporates”. Since 2018, it adds the overall number of Asia Pacific third parties participating in CLS Settlement increased by 31% while respective average daily values settled in the service increased by 28%. In that same time period, the average daily values settled in CLS Settlement by third-party corporates in the region also increased by over 200%.

“CLS Settlement enables us to reduce the number of payments and improve operational efficiencies of our FX transactions,” says Hisashi Takami, manager of finance department at Sumitomo Chemical. “Our goal, in line with our mid-term business plan, is to dramatically increase productivity with digital transformation by leveraging the solutions provided by CLS, SMBC and Refinitiv.”

Jonathan Woodward, head of transactions sales, Asia Pacific at LSEG, adds, “Sumitomo Chemical’s adoption of the FXall suite of services gives them access to deep liquidity with minimised operational and counterparty risk. Our best practices also ensure compliance with corporate governance and accounting regulations as well as FX guidelines.”

Meanwhile, Makoto Miyazaki, general manager, Japan and Korea, at CLS, says, “Large, multinational companies are increasingly looking for effective and sustainable solutions for FX settlement risk management and for streamlining their operations to support growth. This development spotlights the proven benefits of CLS Settlement and the strong demand for CLS’s services from corporates, especially in Japan.”