11 March 2009 News

 

Settlers partner to automate messaging for euro medium-term notes

The Depository Trust & Clearing Corporation, Clearstream Banking and Euroclear Bank are expanding the scope of the European Pre-Issuance Messaging system to support the growing Euro Medium-Term Note market. EPIM will now automate the pre-issuance communication and International Security Identification Number allocation process for Euro MTNs. 

The Euro MTN market has grown 22% over the past two years, from €5.0 trillion outstanding in early 2007 to €6.1 trillion in early 2009.

EPIM is being used in a similar capacity within the European Commercial Paper and Euro Certificates of Deposit markets. Since 2002, it has served as a central messaging hub directly linking dealers, issuing and paying agents, securities depositories and numbering agencies, allowing them to exchange standardised and secured issuance information in real time. By automating pre-issuance information processing and ISIN allocation for new ECP and ECD issues - and now Euro MTNs - EPIM should enable these markets to grow and to process these transactions for same-day settlement.

EPIM is intended to reduce manual processing costs for the industry, eliminating the labour-intensive and error-prone phone, fax and email-based communications generated during the ISIN request and allocation processes. Through a streamlined, industry-standard messaging and automated workflow, EPIM should increase accuracy and reduces processing errors, discrepancies and delays, while preserving the flexibility that characterises the short-term debt money markets.

"EPIM has brought us closer to achieving full straight-through processing in the European commercial paper marketplace," said Peter Eisenhardt, chairman of the International Capital Market Association's ECP Committee. "Speed is absolutely critical, especially when there's volatility in the money markets. With EPIM, ISINs are assigned in less than five minutes."

"The ICMSA membership is delighted to see EPIM extend its coverage to MTNs," said Graham Cox, chairman of the International Capital Market Services Association. "EPIM has proven to be a great response to the market's need for a secure, efficient and reliable pre-issuance communication tool. Given its capabilities in terms of volume and speed, and contribution towards STP, we encourage the issuing community to adopt the expanded functionality EPIM offers."