On 22 March 2022, the European Central Bank (ECB) published a speech by Fabio Panetta (Executive Board member, ECB) entitled ‘Building a robust and diversified clearing ecosystem’.

Key points in the speech include:

  • When assessing the resilience of the clearing ecosystem, regulators should not focus exclusively on central counterparties (CCPs). Clearing members also need to react to external shocks to ensure they deliver on their obligations to clients and other end users.
  • Considering the size of the European economy, the importance of European market participants and the relevance of the euro as an international currency, there is ample room for the EU to expand the availability of clearing options.
  • Emerging economic, macro-financial and environmental factors, as well as changes in ownership structures and consolidation in the post-trade landscape, might all increase interdependencies and have implications for systemic risk. Risks might emerge that had not been considered previously, while new channels might help spread existing risks.
  • It is crucial that the ECB sharpens its understanding of new risks stemming from climate change. The European Securities and Markets Authority (ESMA) work to develop a climate risk stress test for CCPs is an important step that the ECB is actively supporting.
  • The risk of misuse of crypto-assets to circumvent the sanctions against Russia is an important reminder that these markets must be required to comply with the strictest standards – including as regards know your customer, anti-money laundering and disclosure requirements – so that they do not create a major loophole at the heart of the financial system.