NEX Optimisation launches the industry’s first automated Settlement Netting Service

03 July 2017

- New service launched for OTC FX and will expand to all asset classes in the future

London, New York – NEX Optimisation, which helps clients reduce complexity and optimise resources across the transaction lifecycle, announces today that it has launched the industry’s first fully automated Settlement Netting Service to streamline the bilateral settlement netting process for market participants.

The Settlement Netting Service will automate settlement netting of over-the-counter foreign exchange (FX) trades and will expand its offering to all asset classes in the future.

Settlement failure rates are estimated at approximately 3% for the $1.5 billion (USD equivalent)1 which is settled on a daily basis between clients and their dealers. NEX Optimisation’s new service will eliminate the manual process of netting between clients and their dealers by applying an API to seamlessly communicate with the clients’, banks’ and custodians’ systems and reconcile payments. Through an automated workflow, market participants will have complete visibility into and control over the payment preparation process for net and gross trades, which will minimise their intra-day settlement exposure, reduce settlement fails and provide greater certainty of funding needs.

Developed using Traiana’s technology infrastructure, the service will bring multiple benefits to the market such as:

  • Improved settlement efficiency by reducing the lead time between netting and settlement which results in additional credit to support trading activities;
  • reduced operational and funding costs, settlement fail breaks and costly claims;
  • reduced risk exposure and adherence to regulatory regimes such as the FX Global Code of Conduct and settlement risk management principles (BSBS 2412, SR 13-243);
  • an increase in the number of trades that can be net settled; and
  • a standardised process for netting participants. 

Joanna Davies, Managing Director at Traiana, said: “The Settlement Netting Service will allow traders to execute with any bank on any trading venue and enjoy optimised, efficient, automated and consistent post-trade processing from execution through settlement. Settlement netting processes have traditionally been fragmented across organisations and asset classes, requiring extensive manual processing, which does not reflect the way in which the market is moving. By automating the entire netting process via a central hub, we’ve brought an essential tool to the market that will significantly reduce breaks and have a direct impact on costs for our clients.”






NEX Optimisation Leading the transformation of market structure, NEX Optimisation offers a portfolio of cloud-hosted services across the transaction lifecycle. Ranging from pre-execution credit checking to multilateral portfolio compression, our purpose is to simplify our clients’ workflow and help them optimise their resources. We are an integrated team of financial markets and pioneering financial technology specialists who operate in all asset classes, geographies and business sectors across the financial markets.

We are dedicated to mitigating risk, increasing efficiency, reducing costs and streamlining increasingly complex processes for our clients. We offer the opportunity to optimise both regulatory and financial resources.

As part of the transformation in the way that NEX Optimisation delivers its services to customers, the business launched NEX Marketplace on 15 May 2017. NEX Marketplace is a new website which provides an interactive and consolidated view of all of its services, categorised and searchable intuitively by asset class, instrument, client type, solution and business. To access NEX Marketplace, please click here.

Traiana A NEX Group business, Traiana operates within NEX Optimisation which helps clients simplify complexity and optimise resources. We provide the world’s markets with regulatory reporting services that monitor pre-trade risk and automate post-trade processing of financial transactions for listed and over-the-counter trading. Our networks link market participants in high speed-to-market, real-time communication across the trade lifecycle, globally. Services, such as the Harmony Network, have become the market standard for post-trade processing in an increasing number of markets.
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