Cboe Clear Europe is approaching the first anniversary of clearing European securities financing transactions for equities and ETFs, and is aiming to expand into other asset classes and other jurisdictions for beneficial owners who lend out European securities.
Vikesh Patel, Cboe’s global head of clearing and president of Cboe Clear Europe, told Markets Media that clients told the firm they wanted securities lending to become more capital efficient two and a half years ago. Bank balance sheets were constrained by new capital requirements, with securities lending facing particularly onerous capital charges, and beneficial owners wanted to continue to lend out their portfolios to get a better return on their assets.
Vikesh Patel, Cboe
“Central clearing was identified as a way to substantially reduce these new capital charges and whilst there had been previous unsuccessful efforts to introduce a clearing solution to this market, industry motivations were now much stronger,” he added. “This is an industry success story that shows what can be done in a European-based clearing house and can have a global impact.”
On 29 November 2024 the firm received regulatory approval to clear securities financing transactions, initially covering European equities and ETFs.
“Introducing clearing to what is predominantly bilaterally transacted required significant behavioural and operational change in the ecosystem, so we spent much of the first year, 2025 essentially, ramping up the offering, onboarding clients, and connecting to lending venues, initially Pirum, to bring this solution to life with others planned,” said Patel.
On 31 March 2025 Cboe Clear Europe said in a statement that it has started clearing European securities financing transactions (SFTs). The business said it used its position as the largest pan-European clearing house for cash equities to launch this “first-of-its-kind” service, which represents a key step in the company’s strategy to become a leading multi-asset class clearing house in the region.
Source: Cboe
Central clearing results in capital efficiencies, particularly for risk-weighted assets, and due to the ability to cross-margin between cash equities and SFTs. Capital efficiency is also critical due to the increased regulatory, capital and operational burdens associated with SFTs from the Central Securities Depositories Regulation (CSDR) and Securities Financing Transactions Regulation (SFTR) in the European Union, as well as the planned Basel IV implementation. Europe is also cutting its securities settlement cycle by one day to T+1, the day following a trade, in October 2027 and Patel said efficient securities financing is key to enabling T+1, especially for equities and ETFs.
Natixis Corporate & Investment Banking was a principal lender against JP Morgan as a borrower in the first trades cleared through the new service. Grégoire Froehlich, GSF trader at Natixis Corporate & Investment Banking, said in a statement: “Clearing SFTs at Cboe Clear Europe enhances our capital efficiencies and reduces operational complexities associated with these products.
The initial target was to reach three lenders and three borrowers. Patel said the SFT service now has BNY and Citi as agent lendera for UCITS and non-UCITS beneficial owners and Natixis Corporate & Investment Banking as a principal lender. There are four borrowers – ABN Amro, Goldman Sachs, JP Morgan and Citi.
BNY began clearing SFTs on behalf of UCITS clients in November 2025 which Patel described as a “key milestone” as the service expanded to substantial pools of lendable assets. Cboe Clear Europe and BNY launched a new title transfer model which enables UCITS – alongside other beneficial owner lenders, such as sovereign wealth funds, pension funds, and central banks – to centrally clear SFTs without posting margin or contributing to the CCP’s default fund when acting as lenders.
Borrowers and market participants are adding a form of preferential routing and scheduling with the aim to borrow as much via a cleared solution as possible before looking at bilaterial trading and other capital tools, according to Patel. They are also acting to expand supply from beneficial owners to build critical mass.
“We aim to grow substantially the service this year by expanding into jurisdictions including the U.S, Australia, Japan and Canada and U.S. for beneficial owners who are lending out European securities,” added Patel. “Other types of lendable assets are also on our roadmap – including fixed income and US equities.”
He continued that building out new clearing ecosystems like this can take three to five years to reach strong levels, but Cboe Clear Europe is already seeing really strong initial traction as the market appreciates the capital efficiencies and operational benefits. Overall, Cboe Clear Europe’s market share increased to 39.6% in the fourth quarter of 2025, up from 38.5% in the same period in the previous year according to the firm.
Craig Donohue, Cboe Global Markets
Craig Donohue, chief executive of Cboe Global Markets, said on the fourth quarter 2025 results call that the group is unlocking incremental revenue opportunities through its SFT clearing service in Europe.
Donohue said: “The first trades were executed in March 2025, and we have seen hundreds of new contracts across 15 active European settlement locations cleared every day between borrowers and lenders, with notional outstanding loan values exceeding €1bn in January 2026.”
Equities trading
In addition to SFTs, Cboe Clear Europe also clears European equities. Cboe reported that in February 2026 total on-exchange average daily value traded in European equities hit a new all-time high of €69.1bn, up 23% year-over-year. Average daily value traded surpassed the previous high of €68.6bn set in March 2020 at the start of the Covid pandemic.
Cboe Europe said it had an overall market share of 25.98%, up from 25.5% in January 2026, making it the largest pan-European stock exchange.
Source: Cboe
In the U.S., Cboe said in a statement on 16 March that it has filed with the Securities and Exchange Commission to launch near 24×5 U.S. equities trading on its Cboe EDGX Equities Exchange (EDGX). Cboe is preparing to launch in December 2026, pending regulatory review and the readiness of required industry infrastructure providers.
In the proposal all listed NMS stocks would be available for trading on EDGX from Sunday 9 p.m. ET to Friday 8 p.m. ET, with a one-hour operational pause from 8 p.m to 9 p.m. ET Monday through Thursday, excluding U.S. market holidays. All trades are planned to be cleared through the Depository Trust and Clearing Corporation (DTCC).
Oliver Sung, head of North American equities at Cboe, said in a blog that expanding trading hours is a “transformative” step to ensure Cboe’s U.S. equities markets are globally accessible.
Oliver Sung, Cboe
The demand for extended trading hours for U.S. equities has been consistently growing, according to Sung. Average daily volume in Cboe’s U.S. equities in early hours trading between 4:00 a.m. and 7:00 a.m. ET has grown 590% from February 2022 to February 2026 as global investors, especially in Asia Pacific, have wanted to react to current events in real-time.
Cboe already operates overnight markets for multiple proprietary products including VIX futures and options, S&P 500 Index (SPX) options and foreign exchange.
“Trading in Cboe’s proprietary index options from 8:15 p.m. to 9:25 a.m. ET hit record levels in 2026 as investors were able to adjust their trading strategies and reposition as pre-market news broke,” added Sung. “Our Global Trading Hours (GTH) session in our derivatives market, as well as our FX markets, have created the roadmap for Cboe to bring a similar model to U.S. equities.”
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