Clearstream strengthens presence in Taiwan

Clearstream strengthens presence in Taiwan

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Clearstream has announced that it is working with the Taiwanese Central Securities Depository (TDCC) to develop a direct settlement link for global investors and issuers to access the Taiwanese international bond market, such as the Renminbi-denominated ‘Formosa bond’.

By opening an account with the TDCC, Clearstream becomes its first international central securities depository foreign participant.

The settlement link, to be operated by Deutsche Bank and due for completion over the next 12 months will offer settlement and custody services for foreign currency denominated bonds including the Formosa bond.

According to the Central Bank of the Republic of China (Taiwan), RMB deposits in Taiwan as of February 2014 were in excess of RMB247bn ($39.6bn) for domestic investors. However, participation for foreign investors remains very limited since the market infrastructure does not yet exist to enable an increase in foreign investment.

Clearstream’s settlement link will help address this by offering a new direct channel for foreign investors to access the Formosa bond market.

Berthold Kracke, head of business management responsible for network management and a member of the Clearstream executive board said, “A Clearstream account opening at the Taiwanese central securities depository paves the way to deliver global access to the Taiwanese market as an important contribution to connecting Asian issuers with global investors.”

The TDCC stated, “In conjunction with the government’s active promotion of international business development opportunities, TDCC is committed to attract international central securities depositories to Taiwan and to connect with international investors.
 
Clearstream’s participation in TDCC will facilitate investments and settlement between international investors and the Taiwan international bonds market. TDCC will continue to improve standardisation and automation to achieve a more complete and diversified offering for international investors.”
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