Bank OTP Becomes a Part of CLSSettlement as a Settlement Participant
In a significant move, OTP Bank Plc., Hungary's largest commercial bank and a leading player in the Central and Eastern European region, has joined CLSSettlement as a settlement member. This decision reflects OTP Bank's dedication to creating a more robust FX ecosystem and aligns with the best practices outlined in Principle 35 of the FX Global Code.
The strategic move by OTP Bank is aimed at mitigating foreign exchange (FX) settlement risk and enhancing operational efficiency. By adopting CLS's globally recognized payment-versus-payment (PvP) system, OTP Bank seeks to eliminate the risk that one side of an FX trade fails to deliver, a key concern for regulators and market participants.
CLSSettlement's multilateral netting mechanism also offers significant liquidity benefits for settlement members, resulting in liquidity savings of approximately 96%. This means that OTP Bank can free up capital for other uses such as lending or trading activities.
The addition of OTP Bank brings the total number of settlement members in CLSSettlement to 75. In H1 2025, CLSSettlement had an average daily settled value of USD7.9 trillion, a 12% year-on-year increase.
Attila Bánfi, Managing Director of OTP Global Markets, commented on the decision, saying, "Joining CLSSettlement is a crucial step in our strategy to build a more resilient FX operation aligned with best risk management practices. This move reinforces our commitment to strengthening our FX ecosystem and middle office functions amid rising regulatory scrutiny and the complex challenges of cross-border FX flows driven by trade and investment."
Lisa Danino-Lewis, Chief Growth Officer of CLS, also commented on OTP Bank's decision, stating, "We are delighted to welcome OTP Bank to our trusted network delivering global liquidity benefits. OTP Bank's participation in CLSSettlement demonstrates the growing appetite among financial institutions to adopt PvP settlement solutions and benefits from best-in-class netting and liquidity management across the 18 most traded currencies."
This move by OTP Bank also highlights a broader trend among financial institutions to focus on mitigating FX settlement risk and increasing efficiencies. The growing appetite among financial institutions to adopt PvP settlement solutions underscores the industry's recognition of CLSSettlement as the global standard in FX settlement risk mitigation across 18 of the most traded currencies.
OTP Bank's decision to join CLSSettlement is part of its ongoing strategy to support its significant growth and expansion. As a leading bank in the region, OTP Bank's participation in CLSSettlement reinforces its commitment to FX risk mitigation and supports liquidity optimization and regulatory compliance. The liquidity savings in CLSSettlement enable cash flow for other business operations like trading and business growth.
With this move, OTP Bank joins a prestigious group of institutions committed to enhancing the global FX market's operational robustness and efficiency.
- OTP Bank, in its efforts to strengthen its FX ecosystem and align with best risk management practices, has chosen to join CLSSettlement, a decision that positions them among 75 settlement members and highlights their commitment to FX risk mitigation and liquidity optimization.
- capitalizing on CLS's globally recognized PvP system, OTP Bank aims to eliminate settlement risk and improve operational efficiency in FX trading, freeing up capital for other business operations like lending and trading activities, thereby reinforcing their strategic move towards a more robust FX market.
