• Reduction in payment value reduces size of required liquidity buffers.
• Reduced debt costs and associated improved income from profitable reuse of assets estimated at 100-150bp for major currencies.
• Netting efficiency (modelled at over 90% reduction in payments volumes) delivers savings of $’00 millions per annum to international banks.

Capital

• CNS (treated as other netting services) can reduce capital held against Liquidity Coverage Ratio, releasing significant HQLA to the business.

Operations

• CNS requires minimal operational change; banks maintain existing settlement and reconciliation workflows.

• Fewer interbank payment transactions reduces transaction failures (netting community is de facto reconciliation agent).
• Coordination of payment timings across banks leads to lower net exposures.
• Session times and maximum gross exposures agreed between each netting pair further reduces counterparty risk.

Costs

• Reduced payments volumes means lower payment transaction costs and associated messaging charges.

Technical

• CNS re-uses well tried and tested software utilised by major CLS members and RTGS systems. Implementation is simple and straightforward.