Triparty for corporates Break-out session Euroclear Collateral Conference Tuesday, 13 May 2014

The repo market is the ideal meeting place for lenders and borrowers looking for secured term investments 2 Moving from unsecured to secured investment Introducing Repo Post-crisis, a treasurer’s three objectives: Investing in line with term liabilities Securing his investment Obtaining a reasonable return

Securities Cash 3 Collateral providerCash provider Moving from unsecured to secured investment Principles of Repo Securities € 200m Cash Opening Collateral providerCash provider € 200m + interest Closing

4 Moving from unsecured to secured investment Repo – what value does it bring ? Post crisis 3-month liability invested in a 1-week asset Libor: the unsecured curve opportunity gain Spread between unsecured & secured curve You can invest longer term in a secured way!!

5 Moving from unsecured to secured investment Higher returns for secured financing EUR rate for Investment grade collateral (BBB and above ) unsecured Euribor rate average rates Euroclear Bank triparty repo

6 Triparty collateral management Benefits for the Corporate The benefits of Repo Minimal operational effort through a triparty agent ► Complete outsourcing of collateral management tasks ► No fees for cash providers The best of both worlds

Euroclear 7 Securities Cash Transfer of eligible securities against cash in a secured way Valuation of securities on daily basis to make sure always equal to 200m cash Margin calls and releases according to valuation Triparty Collateral management The repo outsourcing solution € 200m During the lifecycle of a repo Collateral providerCash provider

8 Triparty Collateral management The repo outsourcing solution Automatic processes Integrated systems protect you against settlement and custody risk Matching of trade details Selection according to eligibility Transfer of securities Daily mark-to-market Margin calls and releases Asset servicing of collateral Dedicated support Operational teams guide you in your day-to-day operational needs

Euroclear has a light footprint: ► Instructions can be sent via Bloomberg, Fax or Swift Lite ► Web-based and reporting of collateral received, at flexible frequencies 9 Triparty Collateral management Communication means

10 Triparty Collateral management Entering the repo market Cash Borrower Corporate treasurer Repurchase Service Agreement Repurchase Service Agreement Bilateral repo agreement e.g. GMRA Enables trading repo Outsources collateral management to Euroclear Bank

Repo is still a challenge for many treasurers Triparty Collateral management Admission and legal effort Euroclear Bank has simplified its admission and registration process to ensure smooth onboarding But negotiating and signing a bilateral GMRAs remains a time-consuming and costly exercise… 11

Introducing RepoAccess A new service for Corporates Euroclear’s answer to the challenge posed by the GMRA is RepoAccess, a free service available to Collateral Takers Through RepoAccess, Euroclear Bank leverages its existing GMRAs with all major Collateral Givers to set-up new relationships between the Giver and RepoAccess clients 12

13 Euroclear will establish a new GMRA, based on its existing GMRA, in the treasurer’s name A treasurer can have the benefits of repo while being shielded from negotiating a GMRA Euroclear Bank RepoAccess Principles Euroclear obtains a mandate to set-up a GMRA

Euroclear Bank RepoAccess Legal framework Cash Borrower Corporate treasurer Repurchase Service Agreement Repurchase Service Agreement Bilateral repo agreement (GMRA) Agency agreement The Agency agreement enables Euroclear to handle the set-up of the GMRA 14

With RepoAccess, have The benefits of industry-standard agreements (vs proprietary alternatives) Flexibility over post-trade settlement (bilateral, other triparty agents) Full control of the collateral profile and of trade execution 15 Euroclear Bank RepoAccess Advantages

16 Interested in joining the Collateral Highway? Contact your relationship manager or one of our specialists Olivier de Schaetzen +32 (0) Simon Mees +32 (0) Triparty Collateral Management Getting started