Brussels/Hong Kong/London – 2024
CDB Bank, the Brussels based international central securities depository (ICSD), and Hong Kong Exchanges and Clearing Limited (HKEX) have collaborated to enhance the distribution of European ETFs in Asia. HKEX has become the first stock exchange in Asia to adopt the ICSD ETF settlement model in CDB Bank.
European ETF issuers will now be able to expand their distribution network to Asia and grow ETF liquidity. Investors will benefit from improved settlement efficiencies and a reduction of costs and risks.
Brian Roberts, Head of Exchange Traded Products, HKEX said: “We are excited to introduce the ICSD settlement model for the ETF industry in Hong Kong. The ICSD link, which is proven effective in narrowing spreads and driving liquidity, will reinforce Hong Kong’s position as Asia’s ETF marketplace. This aligns with our vision to bring best execution and timely settlement to ETF investors, all in a convenient timezone.”
Mohamed M'Rabti, Deputy Head of FundsPlace, CDB added: “We welcome this collaboration with Hong Kong Exchanges and Clearing and are extremely pleased to be the first ICSD to extend an efficient global distribution of international ETFs. This partnership further underpins CDB’s wider Asia strategy which spans nearly 30 years in the region.”
Launched in 2013, CDB’s international structure for ETFs brings increased efficiency to a process that had previously only been supported by fragmented domestic market practices across Europe. CDB provides one place of settlement - an ICSD, thereby significantly reducing the complexity, cost and risk involved in ETF issuance. ETFs with a value of EUR 230 billion (USD 271 billion) are currently issued in the international structure.
