Choosing a Settlement Member in the CLS Era

Continuous linked settlement (CLS) is a relatively new clearing system technique for Asian banks, as the original seven currencies, and hence participants, were largely European and North American.

  • CLS' popularity in Asia is expected to increase with the inclusion of the Singapore and Hong Kong dollars in 2003 and 2004, respectively.
  • This case study examines how Dah Sing Bank DSB, as a third-party participant, came to choose HSBC as its CLS settlement member.
  • DSB's comparison of potential settlement members was not limited to the traditional criteria such as system requirements and pricing, as these factors were found to be similar...

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