Cecabank Annual Report 2014

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The trading room conducts
operations in the main national
and international fixed income
(public and private), currency,
equities and derivatives markets,
both on a proprietary basis,
investing its own capital, and to
meet client orders. These activities
are always guided by principles
ensuring ample liquidity and a
high level of solvency. Cecabank is
also a market maker for Spanish
Treasury Public debt, actively
participating in auctions and
facilitating secondary market
liquidity, not only in spot sales,
but also in repo market financing,
given that Cecabank is a direct
member of the main central
clearing houses (Meffrepo, LCH
London, LCH Paris and Eurex).
Cecabank is a benchmark
institution in the market
for the sale/purchase of foreign
currency banknotes.
Activity during the year
Cecabank’s treasury has
responded well to the new
challenges. From the liquidity
viewpoint, there has been a
transformation in the source of
business from securitisation funds,
which saw an outflow following
the cut in their ratings in previous
years, to a more stable situation
deriving from depositary business,
in an efficiently timed process.
Three key aspects of fulfilling our
Strategic Plan are building the
stability and diversification of
our business and deleveraging
the balance sheet. These have
been judged positively by ratings
agencies when assessing our
institution. As a result, S&P
improved our rating on 27
November 2014.
Over the course of 2014 we have
managed to reopen lines with
many of our counterparties, not
just as a result of the improved
country-risk perception, but also
our better positioning and the
consolidation of our business
as a wholesale bank. Central
clearing houses have also
increased our operating limits and
reduced haircuts.
At the same time, efforts to obtain
new direct clients from cross-
selling to depositary institutions
have been stepped up, resulting
in an increase in foreign currency
operations with third parties
and repo operations. One key
point to note in these operations
is the technological change
brought about by replacing the
old SICE listings platform with a
new technically more advanced
platform that basically operates
over the Internet.
Derivatives operations
Investments are being made in
reducing the risk and the cost of
capital of derivatives operations.
Highlights regarding this line
include settlement agreements
with members of the LCH clearing
house and membership of the new
national derivatives clearing house
created by MEFF, which is due to
come into operation in 2015.
Government debt
market maker
We continue to promote the
important task of government
debt market making, incorporating
a price quotation platform
via Bloomberg on which
counterparties are given real-time
price information. We continue to
take part in all Spanish treasury
tender operations, including
syndicated operations.
Market maker for
Government debt
Member of the
4 main
central counterparties
Treasury management
Trading Room
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