Euroclear Cooperates with MoF to Facilitate Access to Chilean Capital Markets

Euroclear will be able to extend its Latin America offering and provide investors with a way of accessing Chilean assets.

Euroclear, one of the largest providers of post-trade processing for bond, equity, exchange-traded-funds (ETF) and mutual fund transactions, has announced that international investors will soon be able to access the domestic Chilean capital markets with increased ease, commencing 1 February 2017.

The announcement comes as a result of close cooperation between the Chilean Ministry of Finance and Euroclear to align Chile’s post-trade processes with international standards.

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For the first time, Republic of Chile government bonds, denominated and payable in pesos, have simultaneously been made available to domestic and international investors, in accordance with the financial integration agenda promoted by the Chilean government.

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The government bonds offered and sold to international investors, representing approximately 20 percent of the global issuance, were settled through Euroclear Bank’s account in Deposito Central de Valores (DCV), the Chilean Central Securities Depository (CSD).

The move supports the sustainable development of social and physical infrastructure in Chile.

Rodrigo Valdés, Minister of Finance of Chile, commented: “Our partnership with Euroclear has yielded this important milestone for our capital markets. Being able to tap into the liquidity provided by international investors is tremendously important for the continued development of our local market.”

By making the bonds clearable through Euroclear, Chile has aligned its capital market infrastructure with globally recognised standards and the move is expected to deliver tangible benefits such as reducing the cost of borrowing, increasing liquidity in the local markets and furthering investment in the economy.

Stephan Pouyat, Global Head of Capital Markets and Fund Services at Euroclear, said: “The new regulatory framework, including the new tax treatment rule, enables Euroclear to extend its already well-developed Latin America offering and provide international investors with a simple, efficient and cost-effective way of accessing Chilean assets. This is the result of the strong partnership with the Ministry of Finance to align the needs of the Chilean market and those of international investors. A more robust financial environment supports the sustainable development of social and physical infrastructure in Chile.”

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