CLS services for corporate entities

While the primary focus of Continuous Linked Settlement (CLS) began with commercial banking institutions, it has become apparent that the value proposition is equally attractive to other institutions active in the foreign exchange market. Such institutions might include fund managers, pensions funds or indeed major retail or manufacturing corporate entities. CLS is likely to be of particular interest to major international and multi-national companies that have their own treasury functions.

A corporate treasurer will benefit from a reduced risk profile and the potential to develop its FX business without increasing its risks. Just as important are the payment and cash management benefits that arise from the real time information flows, which are an integral part of the CLS service. Because settlement in CLS takes place across all currencies within a single day and because settlement is effected early in the European operating day, corporate treasurers will be able to exercise significantly greater control on their intra-day and end of day cash positions. Operating efficiencies and the ability to reduce the pressures on back office staff mean fewer problems, greater certainty and increased control.

Corporate entities have not adopted the CLS concept as readily as has the banking community but with the successful launch of the live service in September 2002, we are now starting to see more interest from the corporate market. For further information in respect of how HSBC's CLS third-party service can meet the needs of non-bank institutions, contact your relationship manager or call the CLS Helpdesk on 44 20 7991 0180 or 44 20 7992 0180.