Bank of England calls on ISLA to help OTC market 29 October 2015 London Reporter: Drew Nicol
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The Bank of England has invited the International Securities Lending Association (ISLA) to participate in a sub-group to assist with the implementation of the new term deliver-by-value (DBV) mechanism into the over-the counter market.
ISLA, as part of the committee, will help to address market concerns and participants adopt the new product.
DBV is a settlement mechanism for members of the Certificateless Registry for Electronic Share Transfer (CREST).
Users can deliver a specific basket of securities to the required value from a defined set, such as conventional UK gilts or FTSE 100 equities, to a counterparty. This tool mitigates the need to detail the quantities of each individual security to be delivered.
In a statement on the appointment, ISLA stated: “The product is considered helpful in reducing systemic risk in the UK settlement system.”
ISLA has requested that its members voice any concerns about the implementation. A committee term of reference will also soon be published on the ISLA website.
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