Latin Finance - November 2008 - 53

clearing and settlement roundtable Braced for Impact by Staff Reporters L atinFinance convened a meeting of key clearing and settlement officials in Toronto at the end of September. Following were in attendance: Francis Stenning, CEO and chairman of CAVALI ICVL; Jorge Hernan Jaramillo, CEO of Deceval; Arturo Navarro, senior vice president of operations and international divisions at Indeval; Bruce Butterill, executive secretary of ACSDA; Robin Levy, general manager at Jamaica Central Securities Depository; Dirk Reinicke, managing director for trust and securities services at Deutsche Bank; Mary Ann Callahan, managing director, global relations and development, The Depository Trust & Clearing Corporation; Gustavo Pereira, vice president, Latin America, at Clearstream. The clearing and settlement business is preparing for diminished flow and profitability amid lower valuations and compressed margins. Innovation is a key to survival. more security. We are in the fortunate position that we have actually fared fairly well in the crisis overall. JARAMILLO: Volumes normally increase in a crisis. For example, calls to collateral margins. At this moment we can keep pace with that, it’s no problem. We have to be prepared for bigger volumes . . . to move the assets where people need them. LF: How are volumes in Mexico? NAVARRO: In pesos the volumes for the market are steady. Moving assets where needed: Jaramillo LF: How is your business performing amid heightened volatility and elevated settlement risk? LF: And Colombia, Peru? STENNING: We have not had any troubles, but it has made us review the type of risk measures that the CSDs have been taking in terms of handling and controlling things. Everyone is very concerned with the capital markets as a whole. JARAMILLO: Pressure is more located in the FX market because of liquidity restraints. PEREIRA: We have seen a lot of movement primarily from customers with accounts elsewhere. We have noticed large volumes being moved by these customers to Clearstream. Traditionally, we have always been somewhat conservative in the type of customers we have targeted. In today’s economic turmoil I think that gives us a level of comfort. REINICKE: From a custodial perspective we have definitely seen a lot more volume. We have had our systems tested with peak volumes at peak times and we are also seeing new clients that are actually moving away from institutions that haven’t been faring that well in the crisis towards ourself, seeking STENNING: In Peru it is the same. We went through a boom in our market in the last couple of years and we have been handling many more transactions than in the past. So there is no concern on the operational side. It’s just concern about how the investors are doing in our markets. REINICKE: Our commissions will certainly be going down in the future because the value of the securities have decreased substantially. STENNING: I think we have a very sound economy and very good reasons to believe that things should not be hit that hard in Peru, fortunately. NAVARRO: Mexico is the same. For the first time in a crisis people are not buying dollars, you know, moving it out of the country. The flows are remaining in Mexico. The effect is not a big outflow of money out of Mexico. JARAMILLO: We are developing new businesses because of the impact on volumes that comes and goes. We are ready to 2008 November LATINFINANCE 53

Latin Finance - November 2008

Table of Contents for the Digital Edition of Latin Finance - November 2008