(In)efficiencies of current financial market infrastructures: an empirical assessment

Basil Guggenheim, Sébastien Kraenzlin () and Christoph Meyer
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Sébastien Kraenzlin: Swiss National Bank and University of Basel

Swiss Journal of Economics and Statistics, 2022, vol. 158, issue 1, 1-11

Abstract: Abstract We use unique individual bank-to-bank repo transaction data to empirically assess the efficiency of the existing Swiss financial market infrastructure (FMI) for executing delivery versus payment transactions. This approach enables us to identify its current benefits and drawbacks as well as where new technologies, such as distributed ledger technology, could provide a remedy. We find that the fastest settlement time for repo transactions is 12 s, but that settlements are often delayed by more than 10 min due to the lack of collateral availability. We conclude that the cross-border availability of securities needs to be addressed by either improving interoperability of existing infrastructures or using new technologies.

Keywords: Financial market infrastructure; Secured money market; Distributed ledger technology; G15; G21; G23 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1186/s41937-022-00098-0

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