ISDA (International Swaps and Derivatives Association) Clearing Services Limited has signed a security agreement with Clearstream Banking S.A in 2016. This move has resulted in a more secure and efficient clearing process for the two companies.

Under the security agreement, Clearstream Banking S.A will provide ISDA Clearing Services Limited with a cash deposit that will be used as collateral for the trades cleared by ISDA. This deposit will be held in a segregated account and can only be accessed in the event of default by ISDA.

The agreement also includes provisions for the use of Clearstream’s triparty collateral management services, which will allow for the efficient management of collateral across multiple currencies and asset classes. Additionally, Clearstream will provide ISDA with cash and securities lending services, which will further enhance the liquidity and efficiency of the clearing process.

By signing this security agreement, ISDA Clearing Services Limited has demonstrated its commitment to ensuring the safety and soundness of its clearing operations. The use of a trusted and experienced partner like Clearstream Banking S.A will help to mitigate counterparty risk and ensure the smooth functioning of the derivatives market.

Overall, the ISDA Clearstream 2016 security agreement is an important step towards improving the efficiency and safety of clearing operations in the derivatives market. By partnering with a trusted and experienced institution like Clearstream Banking S.A, ISDA Clearing Services Limited has taken a significant step towards ensuring the long-term stability of the market.