Citi Partners with World Bank on Euroclear's DLT Platform for Digitally Native Note Issuance
Luisa Crawford Oct 25, 2023 02:15
Citi's Issuer Services acted as the Issuing and Paying Agent for the first Digitally Native Note (DNN) issuance via Euroclear's D-FMI distributed ledger technology platform, marking a significant step in digital bond issuance and showcasing a scalable model for blockchain integration within existing capital market structures.
Citi's Issuer Services, a segment of Securities Services, acted as the Issuing and Paying Agent for the first Digitally Native Note (DNN) issuance under English Law through Euroclear's Digital Financial Market Infrastructure (D-FMI) distributed ledger technology (DLT) platform. The transaction involved a EUR 100 million, 3-year DNN issued by the World Bank - International Bank for Reconstruction and Development (IBRD) and was listed on the Luxembourg Stock Exchange.
The Significance of Digitally Native Note Issuance
The issuance and settlement of DNNs on a T0 (same-day) basis mark a pivotal advancement in the bond sector, laying the groundwork for a fully digital transaction lifecycle. This initiative demonstrates a scalable model that merges the merits of digitization with existing bond accessibility and liquidity. It showcases how blockchain technology can mesh with current capital market frameworks, aiming at enhanced efficiency and growth avenues for debt capital market players as the D-FMI infrastructure evolves.
A Multi-Year Collaborative Effort
The initiative is a result of a multi-year collaborative effort among key industry stakeholders including Citi, Euroclear, and IBRD. It aims to establish a robust digital infrastructure for the issuance of DNNs. Andrew Mulley, EMEA Head of Citi's Issuer Services, highlighted the initiative's potential to revolutionize the debt capital market operations. Moreover, Ryan Marsh, Global Head of Blockchain, Digital Assets & Innovation for Citi Securities Services, echoed this sentiment, hinting at a series of digital bond initiatives in the pipeline.
Reflecting on Past and Future Digital Initiatives
Lieve Mostrey, Euroclear Group CEO, and Jorge Familiar, Vice President and Treasurer, World Bank, also expressed their enthusiasm for the digital venture. This initiative follows the World Bank’s earlier blockchain bond "bond-i," further propelling the digitization journey of debt capital markets. Citi continues its endeavor in digital asset solutions, aligning with its strategic objectives and risk tolerance, leveraging a unified technological framework for innovative solutions in digital money, trade, securities, custody, asset servicing, and collateral mobility.
Citi Securities Services at a Glance
Citi Securities Services, boasting about US $28 trillion of assets under custody, administration, and trust, offers an array of securities services solutions tailored to meet clients' demands. With an expansive proprietary network over 60 markets, it stands as a robust cross-border support for clients, manifesting Citi's overarching capability in managing a broad spectrum of financial products and services across nearly 160 countries and jurisdictions.
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