International body set up by globally active private banks in 2002 with the purpose of exchanging currencies step by step (payment versus payment, often abbreviated to
PvP). This eliminates the risk of default if one party becomes insolvent. In addition, the system allows settlement to be improved in terms of time and cost. It is estimated that in the coming years more than ninety percent of all foreign exchange transactions worldwide will be settled via CLS, which is based in Neuyork; in 2006, the figure was already 43 percent. – See settlement, fully automated, clearinghouse, automated, remote access, capital transfer system, electronic, retail payments, electronic, remittance system. – See ECB Monthly Report of April 2002, p. 60; ECB Annual Report 2001, p. 143; ECB Annual Report 2003, p. 131 f.; Deutsche Bundesbank Annual Report 2002, p. 136 f.; and, in great detail, ECB Monthly Report of January 2003, p. 59 ff, ECB Annual Report 2007, p, 170 (cooperative oversight of the system; expansion of operations to include nondeliverable forwards; figures on the scope of operations), ECB Annual Report 2012, pp. 142 f. (CLS is classified as a systemically important financial market entity in the U.S.; oversight issues), and the respective ECB Annual Report, chapter “Oversight of payment systems and market infrastructures”.)
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