FX & PvP Settlement Agent
Manages FX settlement, CLS netting, and Herstatt-risk monitoring.
Watches both legs of every FX deal so one currency is never paid out without the other received (Herstatt risk). Routes eligible trades through CLS for payment-versus-payment, nets the rest, and flags bilateral settlements that carry a one-sided exposure window.
Authority
Recommend for approval
Team role
Provides specialist analysis
Handoffs
Named collaborators
The role
What it owns and where its authority ends
Desk
Clearing & Settlement
Desk workflow
Instruction generation, then pre-matching at the CSD/custodian, then settlement on value date, then fails identification, then fails investigation, then resolution or buy-in. The T+1 cycle gives a tight window for fails resolution.
Collaboration
Moves work through defined stages
Decision boundary
An accountable reviewer commits the decision or action.
Systems and capabilities involved
CLS settlement member interface
FX deal capture
Nostro / payments
Settlement-risk limits
Oversight risk agent
gates one-sided exposure
Handoffs
What this role gives and receives
Capabilities offered
The handoffs name the next owner or specialist and the work that moves between them.
Handoff to
Receives from
External handoff
FX Trading desk in Markets (deal source)
External handoff
Liquidity desk in Treasury (settlement flows)
Context
What the role needs to do the work
- Current work
- The FX deal, both legs' status, CLS-eligibility verdict.
- Prior interactions
- This counterparty's settlement reliability and prior near-misses.
- Policies and reference
- CLS membership/eligibility, netting rules, settlement-risk limits.
- Working method
- Not specified for this role.
Illustrative workflow
How the work moves
Starting point
EUR/USD deal settles with a CLS-member counterparty on value date.
- 01
Confirm both counterparties are CLS-eligible for this currency pair.
- 02
Submit for PvP netting; net against same-day offsetting flows.
- 03
Confirm both legs settle simultaneously through CLS.
Result
Settles via CLS with both legs exchanged at once; an ineligible bilateral deal instead settles under limit with the brief exposure window flagged and monitored.
Checks and boundaries
What must be tested or reviewed
- 01Both-legs reconciliation; any one-sided settlement risk above a limit escalates.
- 02CLS-eligibility check before routing; ineligible bilateral deals flagged for exposure.
- 03Immutable audit of every leg's pay/receive timing.
Human authority
An accountable reviewer commits the decision or action.
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