Supplier sees FX service flaws

Continuous linked settlement disrupts straight-through processing

Banks swap settlement risk for operational risk when they introduce the continuous linked settlement (CLS) service for foreign exchange, according to one systems supplier.

Third-party users connect to CLS through one of the main settlement members. Since their ability to connect was introduced, take-up has been enthusiastic and is a factor in the growth in volume of trades passing through the service, says CLS Bank.

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