GFF Podcast

Exploring CCMS - the Canadian Collateral Management System with Clearstream & TMX CDS

• Clearstream • Season 3 • Episode 2

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In this new episode, our hosts Andrew Keith Walker and Christian Rossler are joined by two guests: Steve Everett, Head of Business Strategy & Innovation at the Canadian Depository for Securities (TMX CDS), and Fabrice Tomenko, CEO of Clearstream International. Together, they discuss the unique partnership between TMX and Clearstream and its far-reaching implications for collateral management and mobilisation in Canada, which has given rise to Canada’s first triparty collateral management platform.

But that’s not all – the conversation also focuses on the future of collateral management in Canada. As the emergence of digital tools, tokenisation and blockchain solutions is reshaping the financial industry globally, our guests provide valuable insights into how Canadian market participants can leverage these developments. They also dive into the Canadian ESG sector and its green bond initiatives.

Andrew Keith Walker:

Hello and welcome back to episode two of season three of the GFF podcast. And we are back here today with a very special show because we are getting our first North American guests on Yes, from Canada, we have Steve Everett joining us, who's the head of business strategy and innovation at the Canadian depository for securities, or CDS, which is actually a CSD, and we'll be unraveling that later on with none other than our very own CEO of Clisium International, fabrice Tomenko, who's going to be joining us again on the show, back again after a great show we did with HQ LAX. But before we introduce our very special guest to you in person, it's time for me to catch up with my cohost, the man without whom there could be the GFF summit, although this week a man who's suffering with just a little bit of jet lag. it is, of course, the senior vice president at Collateral and Liquidity Solutions, clearstream, christian Roslop. welcome back.

Christian Rossler:

Good morning, Andrew. Happy to be back.

Andrew Keith Walker:

It's good to have you back, but you've been traveling. I can see you landed what sort of two o'clock this morning and you're straight into the studio. That's dedication, christian. I'm glad to see that my training has finally paid off. How was it? I understand They said I couldn't be sure if they said you'd been to visit the Fed or if you'd been in a federal prison, i couldn't be sure which one it was. I didn't get the message.

Christian Rossler:

I actually was in North America, yes, but not that the Fed in person. I was in Washington DC, had several meetings there, and so I didn't come back this morning, but I came back on the weekend and I still suffer a little bit from jet lag, as Fabrice must know, because I think he was in Canada recently, and so we're jumping over the big pool.

Andrew Keith Walker:

Okay, Christian, so not just meeting with the Federal Reserve, but I also understand you've been meeting with the IMF and there's some really interesting developments happening there with Clearstream. Tell us more about it.

Christian Rossler:

Well, imf is definitely Clearstream's positioning itself in the space of ESG and International Monetary Fund is doing a development which comes with collateral management on top. We are discussing currently with the IMF to position ourselves, which is really interesting, given that I was actually scheduled to go to New York and I had to cancel because of weather conditions and then also massive flight cancellations. There was actually air traffic control issues in the US, plus the bushfire in Canada and the smog in New York. I believe Steve can speak about it better than anybody else Being in the States trying to work on the solutions for climate finance and climate change and then being cornered on the ground, not being able to go and continue my business trip. that was really, i mean. so it's spot on what we're doing there.

Andrew Keith Walker:

It really does bring home the importance of encouraging capital flows into green projects and sustainably linked projects, especially with the fires that are out there, which, fortunately, are out Now. normally, christian is the man who puts out the fires for me on this show, and joining us here, though, is someone I really want to welcome with a huge GFF podcast Sound Effect Steve Everett, who is the head of business strategy and innovation at CDS, which is a CSD. Steve, welcome to the show.

Steve Everett:

Thank you. Thanks, Andrew Great to be here.

Andrew Keith Walker:

It's really good to have you here. I want to come to you in a second because, first of all, i also want to introduce someone who the audience knows very well already, fabrice Tomenko, the CEO of Clearstream International, who was last on the show with us with HQ LAX and Nick Short there talking about blockchain and all things to do with collateral moving across the world at lightning speeds. Of course, that seems like a really good way to set up the big picture for how Clearstream and TMX CDS started working together and collateral management. So, fabrice, set the scene for us here. How did you begin working with Steve? How did Clearstream's collateral management and tripartite collateral management services make that leap across the Atlantic to North America?

Frabrice Tomenko:

Hi, andrew, thank you very much for welcoming me again on this show.

Frabrice Tomenko:

Indeed, i mean, steve and myself know each other for a long time because we have been doing some work around collateral already in the past, when he was at Strait, so South African CSD, basically.

Frabrice Tomenko:

So the connection was already done to a certain extent And Steve has a good understanding of what collateral management is and what is required to implement a property solution for the domestic market. And, at the end of the day, both Clearstream and TMX was looking to do exactly the same thing, so helping market partners to mobilize the pool of collateral in a more efficient way. And we have seen since years, and maybe more than 10 years, that Canada was looking for a solution, looking at what Europe was doing. And I think and Steve, we probably talk about this a bit further, but I think the time is right now, given the market evolution, market transformation that is taking place, when we are talking about TMX-T1, for example, in this market or some of the new GC product that is required. So timing is perfect, same objective, and therefore it was obvious to us that the partnership with TMX makes complete sense.

Andrew Keith Walker:

And so, steve, i want to come to you now because, of course, prior to moving to Canada and joining TMX and that sort of lead role at the securities depository there, previously to that you were working at Straight again in South Africa in a marketplace where there was a great deal of disruption, of course. Notably Barclays sold off their sort of subcustody network. There were huge changes going on in network management and infrastructure down there. So you've been through some big changes And I want to ask you what's it like now in Canada and presumably across the whole North American scene? Is it a disrupted market? Is it a different set of challenges facing market participants there than perhaps over here in the EU or in Asia?

Steve Everett:

Yeah, i think it's a very stable and incremental market. So certainly, what I think has happened if I just have a look at a post trade perspective it's been fairly stable and neutral for probably going on a decade and a half Now. I mean that sounds like the diplomatic thing to say, but there's certainly. What happens in a stable and neutral environment is that innovation isn't really driven to the extent that it could be, and I think the role of market infrastructure is both to reduce risk, improve efficiency in the market and drive down costs, but also to move the market forward in efficient ways using new technologies and new ways to do things. So I think that to date, this certainly been something from a Canadian market perspective that's really seen incremental improvement over the last decade and a bit.

Steve Everett:

However, the world is moving on, technology is moving on. A lot about peers, particularly in the EU and I can even say from a South African market infrastructure perspective, that market was a lot younger than this market, so it kind of started off at a newer technology level. So, yeah, things change quickly. It's slowly, slowly, suddenly, and I think that that's something we've seen in within the Canadian context And Fabrice and I I think I said to him the other day, and I'm not sure if this is true or not, so we have to test it, but I think we might be the only two people that have put in a domestic tripod twice. It's hard enough to put in a domestic one once, but a domestic one twice, and I'm not sure if he goes to the lab here. Well, i've got a list in him, so maybe we'll go for a third round And you get it.

Andrew Keith Walker:

Okay, that's good. Now I want to come back to you on that, fabrice, because of course, this is a big. this is a big deal, isn't it actually? Because triparty is still, in a way, i guess you might say it's relatively new. We've had a lot of bilateral relationships going back into the past, but triparty is the same as centralized clearing and GC pooling.

Andrew Keith Walker:

These are the new directions that are taking place, aren't they? And certainly, as Steve was saying, where you have relatively new markets, where you started a different technological level, there is obviously sometimes a faster pace of innovation. There's a bit more of a sort of a startup scene going on there. What's it like? Because you're taking the CMAX engine presumably over to install this in Canada and you may be dealing with legacy systems and legacy connections from market participants as well. But what about the other new products that have launched over in EU? Maybe we're talking about something from the D7, digitalsuite or Oscar GC pooling, any of those sorts of innovations that have come out from the rest of the Deutsche Börse group? Are all those tech products going to migrate their way over to Canada?

Frabrice Tomenko:

Thank you, andrew, for the question. I think, indeed, the starting point is our collateral management infrastructure, right, And I think what is important to understand is that our infrastructure is diagnostic from the settlement locations. Therefore, this is one of the reasons we can extend this to other markets, right? And also, another note which, if we compare to what we were discussing about the South African market and TMX, there is a fundamental difference there, right, and the difference is we are not doing white labeling here, right, for the domestic solution, we are providing our services, so Christian banking, in partnership very important with TMX, because TMX helps us to open the pipe to the CSD platform and the market participant, and without that we won't be in a position to deploy our solution.

Frabrice Tomenko:

Now, this being said, of course, of course We will try as much as we can, where it makes sense, to bring also innovation to the Canadian market, and Oscar is a very good example that you mentioned because of GUI, which allow to create and to negotiate eligibility profile using artificial intelligence, will definitely be available for our Canadian market participant.

Frabrice Tomenko:

Right, basically, and when we are talking about other solution or technology, obviously this will come, but always at the moment where there is a need from the market And this is very important. We don't try to impose our product to the market. We listen to the market. We adapt the process and the product to the need of the market. For example, you were talking about GC pooling. Gc pooling in its form will not be a product which will suit tomorrow the Canadian market, but we are working in collaboration with CDC, which is the clearing CCP from the Canadian market, who is introducing a new GC product to replace some bank acceptance product which will disappear next year, and we are building a specific process around that in order to help them and the market to be able to find short term.

Andrew Keith Walker:

And what about HQ LAX? What about the blockchain here? Because we know that the investors and the partners in that project cover some of the biggest custody players in the world, and, of course, that means it does also include some big North American players who have a very large presence there. So, steve, are we going to be seeing the beginning of a blockchain revolution now sort of sweeping through Canada?

Steve Everett:

Well, i think Fabrice's point was great Is that we're starting off with what we know the needs are from the customers on a domestic basis. Now that requirement also exists between jurisdictions, of course. So wherever you have a need for efficient mobilisation within a particular national border, you would also have that outside of that. Certainly, i think that the model around token representation or security representation for HQ LAX is a great one And certainly would solve a lot of market challenges that we have, particularly around time zones. Now let's throw into the mix T plus one and then potentially moving to a T zero settlement model. So these are the real hot topics from a depository perspective and a post-trail perspective.

Steve Everett:

Right now in North America And the move to T plus one is front of everyone's mind The ability to know where your collateral is, to be able to bring it back really quickly, whether that's domestic or international, becomes critical. And this is happening on T plus one, which is Canada's going the day before the US. So we're going on May 27th next year, which is really exciting This product that we're putting in the CCMS, the Canadian Collateral Management Service. Of course we're going in very shortly And the timing couldn't be better because we've got T plus one looming.

Steve Everett:

We also have to what Fabrice was saying earlier. We have this concept of bankers' acceptance is falling away, which is going to be a pretty big hole in the collateral landscape, and that hole needs to be filled with decent quality collateral. We then throw into the mix a high interest rate environment, which is an interesting one, one that we haven't had to deal with for the last decade plus, and the need for services like this that are well managed, that have great risk management, that have trusted partners. It cannot be stated enough how important something like this is going to be, particularly in the run up to T plus one And then straight off to T plus one. Who knows, we could be heading into T zero world, which this product and many of the clear stream offerings are T zero already.

Andrew Keith Walker:

Now, that's an interesting sort of point looking towards the future. but I want to stick with you just for a minute and look a little bit towards the past, because there's been demand hasn't there for triparty in Canada for some time, and this project has been about what? 12 years in its realization. So take us through that. What has been the challenges, the steps, the milestones to get through to be one of the two people in the world who's deployed domestic triparty twice? This is a big deal and you're kind of like this you know someone who's climbed the first person to climb Everest and the I go right. So okay, what was it like? How did you get to the top of this Everest?

Steve Everett:

I think each market is a little bit different. When I look at the yes African market, the challenge there was was, i would say, there weren't many active trope within the country. A lot of the larger banks were using foreign trope party, whether they were based out of London or somewhere else. So that mountain to climb was predominantly around market education and building trust in services like this. So that takes a little bit of time. Within the Canadian context, i think what started to happen was around 12 years ago. So the market had looked at services like this. Cds itself had investigated a bunch of services And obviously, not having been there, the accuracy of the wise is always challenging.

Steve Everett:

However, at a high level, what we could say was having the expertise in this is pretty niche And you would have have to have been around the block at least a few times of putting solutions like this in to understand some of the nuances. So I think what's happened really is learnings from other markets and I can speak to the experience from Clestream, the vast experience from Clestream And then having boots on the ground that have done this before. I think that makes a world of difference because then certain red herrings are identified very quickly and easily and you can focus on the critical issues. If I had to pin it down to that, it's that. And then putting a domestic property in has a lot of market engagement and socialization. You're socializing not just into one area, like securities, lent repo, you're doing it into all the areas, plus your internal firm, plus the regulators. So it's a giant coordination effort that takes place before you even put pen to paper or you first line of code in.

Steve Everett:

And that was certainly my experience having landed here. It was a good, solid year and a half of just aligning expectations around how we can do things, building the right relationships And, of course, trust. I think trust is key and foundational to everything that we do, and CDS and Clestream share in that understanding of that principle And that's something that we pride ourselves on and we want to display and demonstrate to our customers. So I think that, having spoken about it, saying we're going to do it and now at the point of delivery, is a testament from an integrity perspective, our ability to deliver these things.

Andrew Keith Walker:

And Christian and Fabrice. I want to come to you on this one, because I'm guessing that as well Clestream's also got an awful lot of credentials in this space compared to perhaps as there's maybe one other competitor who we don't have to mention on the show, but Clestream is also obviously the ICSD in Germany. You're the CSD in Frankfurt, cbf and Luxe CST as well, so you've got connectivity through that into so many different parts of European infrastructure. You've pretty much got all the experience necessary to cover off every scenario when it comes to connecting with private bank money, settling in central bank money and all those various different elements as well. So I mean firstly, fabrice, i want to come to you Is that something that now is becoming more and more important as a deciding factor when it comes to putting in infrastructure, having a partner like Clestream who has got so much connectivity experience and so many connections at different points with different sort of settlement networks?

Frabrice Tomenko:

I think it does, andrew, because I mean we were talking about the experience we have implementing domestic solution, so for the market is one example, but we have also done it.

Frabrice Tomenko:

So Australia, we have done as well, brazil, And therefore all those experience put together help us really to build an infrastructure which is flexible and which can answer many, many of the different market demand.

Frabrice Tomenko:

And obviously the starting point of all this was the need to also try to adapt our domestic German domestic solution and our international solutions through the ICSD, and you may have heard that recently, last year, we have merged the two basically. So we have merged all domestic services in Germany and or international services onto one platform And therefore this obviously is a huge, huge exercise, but huge also part of experience that we can use and the connection we have with central banks, ccps, interbank, some asset managers all this help us basically to have a suit of product and services and connection which are always, for example, to easily talk to Bank of Canada when they need to understand how Europe is doing it from a central bank, ecms perspective. And I think and we had, you know, steve can be the witness of this we have shared a lot of information and it was really interesting conversation with them because in North America they are very interested how Europe is dealing with such kind of, let's say, situation, especially in the marketing environment of today.

Andrew Keith Walker:

Now, christian, i want to come back to you for a minute here, because in our last episode, of course, we were talking about ECMS and trying to improve the availability and the flow of collateral within the Euro system, and of course, we're now talking here about a completely different country, a completely different domestic system, but it is all the same infrastructure that's being provided via ClearStream's market infrastructure. And I'm wondering do you think we'll see a time at some point in the future when there'll be much more direct connections between market participants in Canada through their own CDS, through the Canadian central bank, through into Europe and ECMS and the Euro system? Are we seeing the beginning of a much more converged international system for moving collateral and cash between market participants in different jurisdictions?

Christian Rossler:

Well, it's a big question, Andrew. I think that, from a set-up point of view, what we're doing on the Euro system collateral management system in April 2024 is we're going to act as a tri-party agent for the Euro systems central bank allocation. We are not going to be on the ICSD side the custodian. The custodian will be CBF, which is the CSD in Germany, or luck CSD, which is the CSD for Luxembourg. And that's where it's interesting, in Anorogy to what TMX and clear stream is doing here We are actually Having the head on as try party collateral agent from Christian banking Luxembourg, the ICSD, but we speak to the CSD in Germany and we speak to the CSD in Luxembourg and from that perspective I think you could draw a parallel to what TMX and also clear stream are doing, because I think our Co-retail management system is a satellite system that can speak to Any settlement system and domestic settlement systems, like in Canada now. So from that perspective I would say there's not a direct link between Canadian banks and what we do on the euro system collateral management system, because if you want to pledge collateral to the euro system you need to have a banking license in the euro zone. So of course, if a bank, a Canadian bank, would have a banking license in Frankfurt. They could go through our try party services and allocate collateral through clear stream banking Frankfurt and get central bank money.

Christian Rossler:

Now I think that From that perspective, i think I understand your question and I think that's that's definitely for us Interesting to see what Fabrice has done here together with Steve and the team, because ultimately There is other CSDs in Europe when it comes to ECMS. There's the CSD of Portugal, yes, the CSD Belgium of the Netherlands, and so, and if one would spend the Idea to the very end, one could say, yes, clear stream has the capability, because we demonstrate here with TMX and Canada that we can actually quickly and I think this is what I understand from the conversation here with Steve and also Fabrice this was really a quick time to market delivery here, and so one could and That's, i think, purely from a Technical point of view well, could. I'm not talking about political dimension, because in the euro zone everything is political, but technically speaking one could say, yes, christian is very well positioned in the future to be also speaking to other CSDs in Europe with its collateral management system.

Andrew Keith Walker:

I know it's a big future question, christian. That's why I asked you. I always throw you the tough ones, you know that. But okay, fine, it's time Let's start drawing these threads a little bit together and looking towards the future, because this is the beginning of something that is going to go a long way now.

Andrew Keith Walker:

One thing We do know is that you know, the whole world is faced with a bunch of issues that are arising from, i suppose, a general move to try and reduce collateral fragmentation, increase the speed at which collateral can move, increasing ability, increasing cleared set, glending and repo and to try and facilitate the regulators goals to Make markets safer and to sort of de-risk bank finances. And we know that's an issue at the moment because with excess liquidity there is more chance in the system of more risky deals being made. And We also know that the regulators here in the year enhancing big regulatory regimes like a mere refit and that's going to be a huge Disruption for market participants. And of course, in Canada you have the CSA OTC reporting Requirements to. So what do you think the impact of the TMX clearstream deal is going to be on the Canadian market For the long term? and what then do you focus on next, once the collateral management, the CCMS, goes live.

Steve Everett:

The initial implementations critical because setting up of the networks, in other words counter parties, on boarding is a very crucial step to Realizing mobilization. So a network is only as strong as the members of that network and as the network expands Within the market, the ability for collateral to move a lot quicker in a more efficient way, tracked, with unlimited substitution, becomes realized. Then the Canadian market now We're kicking off with repo As a phase one. We're moving on to a more cleared repo type product and then we're very quickly adding Some other products securities, lending and others On to that. So what that means ultimately is within a relatively short time We'll see cross exposure collateralization and inventory optimization within the Canadian market. That is really using the existing suite of tools At clearstream and with the NTMX to realize this. So the synergies work incredibly well for us to achieve this.

Steve Everett:

I think both organizations are at the right time, the right maturity. I want the same things. I think that is that is really important And from a market perspective, you know that is the crucial thing I always say whenever I get up and and talk at a panel the ratio of our ears to our mouth really matters in market infrastructure. We should listen to us as hard as we as we speak, and the The important thing from from us is is what? what are the customer requirements? How are we going to make life easier and better For participants within the Canadian market?

Andrew Keith Walker:

and that is really what we believe we are going to achieve with this product And it's going to have a substantial impact In favor of of market participants and presumably as part of the, the fact that Canada obviously is part of the trading relationship, the CUSMA relationship with Canada, america, mexico and Obviously that in itself interacts quite a lot with South America and with various sort of BRICS economies. This is all about developing connectivity not just within Canada But ultimately with market participants who will span multiple jurisdictions and multiple systems. So, for briefs, does that mean that you're building new relationships with new partners beyond Canada and around the borders, say in the US? Yeah, okay.

Frabrice Tomenko:

It's maybe, andrew, a little bit early to say that, but obviously you know we are there. Our vision is really if we help the market, developing right and trying to address some of these issues about collateral fragmentation, velocity of the collateral, which is very important and Much more important now that we are moving in some of the market in T plus one and Etc. If there is a demand from from the market, of course we will be there to support them. Now we have to to start, maybe, with what we know and and I think Already in Canada, right, the domestic market has its own challenge.

Frabrice Tomenko:

There is a good representation as well of Canadian banks in Europe using our services already in order to cover international exposure, and one of the next Step for us is to look at their request to help them to mobilize Canadian collateral for international Exposure and, believe it or not, today, even for big organization, this, this move from the domestic market to the international, despite the you know, the network that is in place, a system that uses this, is still quite difficult, simply because this is not in the standard of those institution and and therefore we need to to look at this and have them in that direction and and one solution, and I'm happy to make the link with our previous podcast, because one of the solution that the market is Looking at, or asking us to look at, is how can we use hkx platform to help us to do that, and therefore it's a good fit as well for us, because indeed we have all the same objectives improve mobility of collateral, reduce Barriers varies for collateral mobility.

Andrew Keith Walker:

And collateral mobility is something that's very important.

Andrew Keith Walker:

On a slightly different angle and I want to start tying up our discussion, perhaps looking towards a different aspect of the future here and that is looking at sustainability, link bonds, green bonds and ESG, because I know, christian, obviously this is something that you've been in the States talking about just this last week, and we know there's a new fund that the IMF are engaged with and there's a lot of interest in that and with players Within the the EU.

Andrew Keith Walker:

But also, i think we have to acknowledge as well, canada's inaugural green bond won awards for Sovereign of the year from environmental finance magazine. Canadian pension funds Have also been in the news quite a lot recently because they are swapping a lot of their traditional collateral for green bonds, and also we've seen the launch of sustainability bonds in Canada. Plus, of course, we know The GFF summit that was held in August 22. We know that a lot of Market participants have been holding on to their green collateral and keeping it on their balance sheets And it hasn't been moving as smoothly. So is this a chance to perhaps tap into a new green Bond marketplace and get some of that really high-quality green Collateral moving out of Canada and you know, around the world.

Steve Everett:

Yeah, I think, in terms of whether it's a certain asset class or a certain kind of index of assets, it all speaks to optimization. ultimately, Whatever is going to optimize the best utilization of assets, whether that be for a particular trade, for settlement purposes or collateral that is really where our focus is going to be. So something like ESGE or anything similar represents another opportunity for optimization. So it ultimately works in the theme that we've been speaking about today that it is really another chance for optimization to do its magic, which again lends itself to well, things are incrementally, slowly, slowly changing and then suddenly you need to be ready with the right tools, the right infrastructure and the right partners to be able to face kind of a new brave world.

Christian Rossler:

I think that from a perspective of ESG first, and maybe on Canada, i would maybe just say that I see that, in the space of ESG, europe is leading, but then, of course, developed countries are leading in the space of issuing green bonds, whether they are sustainable or sustainable link bonds or blue bonds. Now, when it comes to green or climate finance, what IMS is trying to do currently is trying to channel money from developed countries into emerging market countries, so the money should go into countries that are suffering from climate change and that need either to adapt to climate change or to avoid climate change, and so, when it comes to the bond itself, that's one angle of the structure. The collateral is another angle. Now, the bond itself is a sustainable bond. That means it's built upon the use of proceeds, concept that was actually enacted by the COP in Paris when the first climate conference was done in 2015,.

Christian Rossler:

As you know, these bonds were first launched by World Bank and European Investment Bank, and these are bonds where, actually, you have to demonstrate that the proceeds go to an environmental friendly usage, and this is something that, when one spins this to the very end with the digital revolution and you know the blockchain, and where you can actually in the note itself, and I think Fabrice knows that HQL-AX has a layer which is built on that technology.

Christian Rossler:

You can actually build in that note that you know the money has only to go to certain well-defined use of proceeds And from that perspective you bring all the best worlds together. You bring the world of the technical revolution together with what you want to do on the sustainability side. But that's something we briefly discussed in Washington And it's high on the agenda. I can only say it's high on the agenda and it's something that obviously we position ourselves, besides our collateral management capabilities, which are to cherry on the cake, if I may say so, but we also position ourselves on the principle bond, that is, the sustainable bond, where we will act as obviously custodian and also opening up a link to the market, but then as well with the technology that we are having currently in house, also maybe in the future to digitize the green bond.

Andrew Keith Walker:

And Fabrice, is this on your long-term agenda? As the CEO of Clearstream International, someone who is connected up with projects that link together different continents and different domestic markets, are you seeing that long-term, there's going to be a need for innovation on the tokenization, digitization, ultimately, the integration with collateral management when it comes to green bonds and ESG collateral?

Frabrice Tomenko:

Definitely, and it will not be limited to green bond, but we have to follow the market evolution. So we see that, or at least our vision is that we will have the traditional assets, like today, we will have new issued digital native assets which will be fully digital, which will have to be also used in the securities financing world, and among those there will be a green bond as well. The only, let's say, problem around that is the timing, because in order for green bond to get it to become usable in this environment, you need to have a certain depth of market basically. So you need to have a certain quantity available in the market to make really a big difference, and I would say nobody has crystal balls, but basically it will require sometimes to get to this level.

Andrew Keith Walker:

Now, sadly, we do have to draw the show to a close here, but we can't let you go without asking you this season's very important question, which is all about holidays coming up, because I'm guessing apart from Michael Carinyan, who can't have a holiday until the big bang in April, when ECMS goes live, but after that he'll get a big one, we have no doubt. Jean-rabbière has just been away, obviously, parachute motorbike jumping off mountains in Croatia. You can catch him doing that in the latest Mission Impossible movie. He's coming out soon. Actually, i wanted to ask you about holidays because I have to say I've always wanted to go holidaying in British Columbia, out in Vancouver, out in the woods. I admit I don't know what to do, which colour bear I have to. You know, one you fight and one you lie down and play dead. But tell me, steve, what are your holiday plans After you go live? you've earned a big break. What do you get?

Steve Everett:

Well, like I said, this one is the real hard work actually starts on go live for this particular project. So, obviously, being so close to the US, it's a mix of a couple of short trips across the border and there's just so much to do in Canada in summer. There's, i believe, two and a half thousand lakes just in Ontario, so you spoil for choice, and this time of year all of them are really great, but the ones you'll be focusing on are about two hours north of Toronto. The Muscoke region is a fantastic visit this time of year.

Andrew Keith Walker:

Now, Fabrice, what about yourself? I mean, presumably it's the other way around. Once it goes live, your hard work is done, Do you get a break? or are they now going to parachute you off to somewhere else so you can plug in the blockchains and do all the funky stuff?

Frabrice Tomenko:

Let's put it this way. I made this a point you a little bit. So I will take only one week off just to relax at all. Nothing fancy because I'm traveling already a lot for all those activities. So I need to spend some time with my family but be ready for September. We have Cybers in Toronto. We have an air main Miami coming along, as Steve mentioned. Unfortunately, the hard work does not stop here because we have together with TMX, with Steve, we have to do all the customer onboarding. We have to explain how the things are, is working, the legal, the operational. So still a lot of work to be done.

Andrew Keith Walker:

Okay, well, that is very good, very dedicated, i'm going to say both of you to keep the international wheels of finance running. Of course, one person who's not allowed to have a holiday is my co-host, mr Christian Rosler. I'm told that every night they just plug him into recharge and he keeps going. Christian August is coming. Are you going to get a break as well?

Christian Rossler:

Yeah, i take two weeks, but end of July I'm going to Provence, which is the nice area in France where you have a lot of countryside going for biking and just making myself again fit. As you know, last year was a difficult year falling off my bike. I promise not to do it this year, so I'm still coming slowly back into shape and also doing a lot of gym and fitness.

Andrew Keith Walker:

So yeah, I'm also going to say Christian, in fairness. It was a very difficult year for carbon fiber race bike manufacturers, because you have broken a few, haven't you Pushing them too hard over mountains? If you could see, if you're listening to the show now, if you could see Fabrice is laughing. He knows Christian. If you have a really expensive carbon fiber bike, don't lend it to Christian.

Christian Rossler:

It's actually true that I was actually breaking a carbon fiber bike in the ops. I was riding two days from the summits down at 60K an hour and I had a broken carbon fiber bike. I didn't have a crash The year after I crashed in my Yoka and there I broke my bone, but not the bike.

Andrew Keith Walker:

Either way, i tell you, steve, if there's a chance, i'm coming to the lakes with you, just to be on the safe side.

Steve Everett:

Yeah, yeah, i think the lakes are safe and there's nothing in these lakes that can actually even kill you. There's no crocodiles, nothing.

Andrew Keith Walker:

Okay, well, that sounds I'll take that anytime, But in the meantime, sadly, we do have to tie things together. So I would like to give a huge round of applause to Mr Steve Everett, who is the head of Business Strategy and Innovation at the Canadian Depository for Securities, or CDS, which is actually a CSD. Steve, thank you for joining us. So, and Steve as well, I'm guessing. With something this size, there's a lot of people we should be thanking for getting it to this stage with CCMS or TMX. So who else has helped turn things around there in Canada?

Steve Everett:

Yeah, it absolutely takes a village for something like this and really important, and in no particular order. I'd really like to thank the I Agripo Committee, who've been fantastic supporters, and the CASLA Committee for Securities Lending, as well as the GPFA, who've been really instrumental on the bar side of things, and the Canadian Fixed Income Forum. They've all been wonderful sounding boards, great supporters and hopefully really strong future partners for us.

Andrew Keith Walker:

I'll do that big round of applause for them. And also, of course, man who needs no introduction if you're involved in the world of securities, lending, blockchain or anything else in the EU The head of Clearstream International. The CEO, mr Fabrice Tomenko Fabrice, thanks for joining us. And, last but never least, I'm going to say, especially this episode, my long-suffering co-host, who has to put up. You should hear the rehearsals. They're much worse. Thank you once again for joining me, christian Rossler.

Andrew Keith Walker:

Okay, well, that's it. That is all for this week. Do come and join us on our LinkedIn page That is linkedincom slash company slash Clearstream, where you can find out all about the podcast and you can network with Steve and you can network with Fabrice and you can connect with Christian and with myself and find out more about what's going to be coming up in the rest of the series. That's a message and we would love to hear from you In the meantime, from everybody here. Have a good month, have a safe month and we'll see you in a month. Bye-bye. Don't forget that this show was brought to you by Clearstream Banking, one of the main sponsors of the GFF Summit every year in Luxembourg, and features members of the Clearstream team and special guests expressing their personal opinions, not the opinions of Clearstream as an organisation. And remember, none of the information in this podcast should be taken as legal, tax or other professional advice. See you next time. Thanks for watching.