EBA Clearing broadens access to EURO1 platform

The EBA Clearing Company today announced the introduction of a new participation status, labelled “Pre-fund Participation (PFP),” to the EURO1 clearing platform. This announcement follows the recent approval of PFP by the Governing Council of the European Central Bank (ECB).

PFP participation allows newly joining STEP2 banks that are neither EURO1 nor STEP1 participants to directly and individually settle their daily STEP2 obligations. Unlike full EURO1 participants, PFP participants do not extend bilateral credit lines to other banks on the clearing platform nor do they need to appoint a EURO1 settlement bank.

“Pre-fund Participants will fund their position on the clearing platform at their own initiative and for the amount they deem necessary for their STEP2 settlement,” said Gilbert Lichter, CEO of EBA Clearing. “To that effect, Pre-fund Participants will pay in central bank funds on a special account at the ECB.”

As of 3 November 2003, the first two Pre-fund Participants on the EURO1 platform will be Deutsche Bundesbank and Österreichische Nationalbank. Pre-fund participation status will be open to all financial institutions in the EU. EBA Clearing expects more banks to opt for Pre-fund Participation in EURO1 in the course of 2004. 

Jean-Marie Avadian, Chairman of EBA Clearing said: “Through the introduction of the Pre-fund Participant status, EBA Clearing is taking another step in its drive to offer banks new options to access the EURO1 platform. Pre-fund Participants enjoy the same capabilities as other banks for settling transactions processed by STEP2, the pan-European ACH.”