Bank of America has launched on CLS’ cross currency swaps (CCS) service, as part of an effort to support the expansion of its FX business.
Lisa Danino-Lewis
By integrating with the platform, Bank of America clients will be able to mitigate risks associated with cross currency swaps, such as operational inefficiencies and liquidity constraints due to trade settlement on a gross bilateral basis.
Specifically, the CCS service aims to mitigate these risks by ensuring both side of a swap are settled simultaneously through a payment-versus-payment (PvP) settlement mechanism, to remove potential counterparty failure.
“In an environment of heightened market volatility and increasing intraday liquidity demands, reducing unsecured settlement risk is a priority,” said Carlos Fernandez-Aller, co-head of global FICC macro at Bank of America.
“This milestone demonstrates our commitment to reducing counterparty risk on cross currency swap initial and final principal exchanges while delivering operational and liquidity efficiencies that will support the continued growth of our FX business.”
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In addition, the CCS service can also be used alongside OSTTRA MarkitWire’s post-trade processing platform, integrating CCS flows into CLSSettlement.
This functionality will allow participants leveraging this service to optimise liquidity and reduce daily funding requirements, by using multilateral netting for their FX transactions.
Lisa Danino-Lewis, chief growth officer at CLS, said: “With FX trading volumes at record levels and the average daily settled value continuing to grow, mitigating settlement risk has never been more important. The continued expansion of our CCS service, alongside Bank of America’s go-live, demonstrates meaningful progress in reducing risk across the FX market.”
Bank of America is the latest firm to go live on CLS’s CCS service, following suit from BNP Paribas, Crédit Agricole CIB and Natixis CIB in April 2026.
As part of the shift, the three integrated CCS flows into CLSSettlement via OSTTRA MarkitWire, enabling multilateral netting across FX transactions and improving liquidity efficiency.
