The Multi-Trillion Dollar Bank You Have Probably Never Heard Of

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By admin | June 19, 2008

What bank recently set a record by processing transactions of more than $10 trillion per day?

This bank, founded in 1997, is owned by a Swiss company which in turns owns what the bank itself describes as a UK “shell” company, which in turn owns the bank itself, which is regulated in New York but has its back office operations outsourced to a company registered in England and Wales.

You could be forgiven for not having heard of this bank. It’s not exactly well known. If you go to its own website and click on Press Office > Media Coverage you get “No results found”. Google doesn’t turn up much about it either, except for a few sites rehashing Press Releases put out by the bank itself.

This bank doesn’t have any bricks and mortar branches. I reviewed its website and looked at the “Contact Us” and “Offices” pages and I couldn’t even find a physical street address for it. The only address I could find on their site was a PO Box address in London for sending job applications. Of course it does have a physical office in London’s Docklands, but I’ll be darned if I could find it on their site!

I’ll tell you the name of this bank to see if it means anything to you: CLS Bank International

Even with today’s inflation figures and the dollar losing its value, $10 trillion is a hell of a lot of money. That’s just in one day! (19th March, 2008 to be precise, information from CLS Bank Press Release, source url below)

To put this in perspective, the average total amount that Citi Global Custody Services, one of the largest foreign exchange banks, holds in custody is $13 trillion. So to oversimplify things a little so you get the jist, CLS Bank transacts in a day, not far off what Citibank holds on deposit.

Now, those of you who read my columns regularly are well aware that I’m a free marketeer. I certainly don’t believe that we should restrict currency flows around the world, although I believe there is a strong likelihood of the US doing so at some point in the fairly near future – most likely by the back door. I’m also not a believer in conspiracy theories.

But of course, that $10 trillion was not payments between the likes of you and me, or payments for tangible goods or services. It was the results of pure speculation using money created out of thin air by fractional reserve banking. However, there’s no doubt that volumes of money like this flitting around the globe do affect the stability of the financial system. Maybe it’s not a bad thing to bring operations like this more out into the open.

I’m not saying this will happen, but it’s certainly fair to ask the question, what would happen to the world financial system if CLS Bank suffered a liquidity crisis along the lines of those recently seen at Bear Stearns, Lehman Bros et al?

I’ll be writing more about this bank, and another similar institution the Depositary Trust and Clearing Corporation, in an exclusive article for The Q Wealth Report edition 51, due for release at the end of August. Click here to visit The Q Wealth Report.

Meanwhile, you might be interested to know if you can open an account at this bank, or get a credit card from them. Well, no, you can’t. They only deal with other financial institutions. CLS Bank conveniently published a Press Release earlier this month listing their clients, which I have pasted in below for your edification…


03 June 2008 CLS third party participant list – 2817 now live

In addition to the 61 CLS Bank Members, a total of 2817 participants are currently using the CLS Bank service. Included in this total are 378 banks, corporates and non-bank financial institutions and a further 2439 investment funds.* New third party users are highlighted in bold. Aargauische Kantonalbank, Aarau Abaxbank, Milan ABP (Stichting Pensioenfonds), Netherlands ADM Derivatives Inc., Chicago AIG International Inc, Wilton Aletti & C Banca Di Investimento Mobiliare Spa, Milan Alfa Bank, Moscow Allgemeine Sparkasse Oberoesterreich Bankaktiengesellschaft, Linz Amagerbanken, Copenhagen American Express Bank, Poole Anglo Irish Bank, Dublin Arab Bank PLC, London Arab Banking Corporation, Manama Axis Bank, Mumbai Baden-Wuerttembergische Bank, Stuttgart Banca Akros, Milan Banca Antonveneta, Padova Banca del Ceresio, Lugano Banca del Gottardo, Lugano Banca Del Sempione, Lugano Banca Fideuram SpA, Milano Banca Monte Dei Paschi di Siena, Milan Banca Nazionale del Lavoro, Rome Banca Nazionale del Lavoro, London Banca Nazionale del Lavoro, New York Banca Popolare di Sondrio, Sondrio Banca Transilvania S.A., Cluj-Napoca Bancaperta, Sondrio Banco Comercial Portugues, Lisbon Banco de Sabadell, Sabadell Banco di Desio e della Brianza S.P.A., Desio Banco do Brasil, Rio de Janeiro Banco do Brasil, Tokyo Banco do Brasil, London Banco do Brasil, New York Banco Espirito Santo, Lisbon Banco Popular Español, Madrid Banco Santander Central Hispano, Madrid Bangko Sentral ng Pilipinas Bank Cial, Basle Bank fuer Arbeit und Wirschaft AG, Vienna Bank fuer Kaernten und Steiermark, Klagenfurt Bank fuer Tirol und Vorarlberg, Innsbruck Bank Hapoalim, Tel Aviv Bank Hapoalim, Zurich Bank Internasional Indonesia, Jakarta Bank Julius Baer and Co., Zurich Bank Leumi, Tel Aviv Bank of Asia, Bangkok Bank of Ireland, US Bank of Ireland Treasury, Dublin Bank of Israel, Jerusalem Bank of Montreal, Toronto Bank of Montreal, London Bank of Nagoya, Nagoya Bank of New York – Inter Maritime Bank, Geneva Bank of Scotland, London Bank of Yokohama, Tokyo Bank Rakyat Indonesia, Jakarta Bank Sal. Oppenheim Jr. und Cie. (Schweiz) AG., Zurich Bank Sarasin and Co. Ltd, Basle Bank Sinopac Taiwan, Taipei Bank Von Ernst und Cie AG, Switzerland Bank Vontobel, Zurich Bankgesellschaft, Berlin Bankhaus Lampe KG, Duesseldorf Banque Cantonale de Fribourg, Fribourg Banque Cantonale de Geneve, Geneva Banque Cantonale Vaudoise, Lausanne Banque Carnegie, Luxembourg Banque Degroof, Brussels Banque Degroof Luxembourg S.A, Luxembourg Banque D’Orsay, Paris Banque Federative du Credit Mutuel, Paris Banque Franck, Geneva Banque Jacob Safra (Suisse), Geneva Banque Morval et Cie, Lugano Banque Nationale du Canada, Montreal Banque Privee Edmond de Rothschild, Geneva Banque Safra, Luxembourg Banque Syz and Co. Sa, Geneva Basellandschaftliche Kantonalbank, Liestal Basler Kantonalbank, Basle Bear Stearns Securities Corporation, New York Berner Kantonalbank, Berne BGC Brokers, London BHF Bank, Frankfurt Bipielle Bank, Lugano Biverbanca, Biella Blom Bank, Beirut Bremer Landesbank, Bremen Britannia Buiding Society, Leek British Arab Commercial Bank, London Brown Brothers Harriman and Co., New York BSI, Lugano Caixa Geral de Depositos, Lisbon Caja Madrid – Caja de Ahorros y Monte de Piedad de Madrid, Madrid Canara Bank, Mumbai Cantor Fitzgerald & Co., New York Cantor Fitzgerald International, London Cantor Fitzgerald Europe, London Capitalia, Rome Central European International Bank, Budapest Chicago Mercantile Exchange, Chicago Chinatrust Commercial Bank, Hong Kong Chinatrust Commercial Bank, Taipei Cho Hung Bank, Seoul Chugoku Bank, Tokyo Chuo Mitsui Trust and Banking Co., Tokyo Citadel Investment Group, Chicago Citigroup Global Markets, New York Clariden Bank, Zurich CMC Group Plc, London Compagnie Financière Edmond de Rothschild Banque, Paris Conrad Hinrich Donner Bank, Hamburg Co-Operative Bank, London Corner Banca, Lugano Corporation Bank, Mumbai Credit Industriel et Commercial, Paris Daegu Bank, Seoul Dah Sing Bank, Hong Kong Daishi Bank, Tokyo Dansk Supermarked, Copenhagen Dekabank Deutsche Girozentrale, Frankfurt Deutsche Postbank, Bonn Deutsche Postbank, Munsbach Deutsche Postbank International, Munsbach Deutsche Schiffsbank, Bremen Dresdner Bank, Zurich DVB Bank, Frankfurt DZ Bank, London DZ Bank, Frankfurt DZ Bank, Hong Kong EFG Bank, Zurich EFG Eurobank Ergasias, Athens Ehinger & Armand von Ernst, Zurich Erste Bank Der Oesterreichischen Sparkassen, Vienna Eurizon Capital SGR Export-Import Bank of Korea, Seoul Farmers Bank of China, Taipei Fideuram Bank (Luxembourg) S.A., Luxembourg Fimat International Banque, London Finter Bank Zuerich, Zurich First International Bank of Israel, Tel Aviv Firstrand Bank, Johannesberg Fonds de Compensation AVS/Ausgleichsfonds Der AHV, Geneva Forenings Sparbanken AB, London Forsakringsaktiebolaget Skandia, Stockholm Forstaedernes Bank A/S, Copenhagen GFX Corporation, Chicago Greenwich Capital Markets Inc., Delaware GlaxoSmithKline Finance PLC, Brentford Gulf International Bank, London Gulf International Bank B.S.C., Manama Hana Bank, Seoul Hauck und Aufhaeuser Privatbankiers, Frankfurt Hewlett Packard, New York Hewlett Packard International Bank, Leixlip HDFC Bank Limited, Mumbai Higo Bank, Tokyo HSH Nordbank, Copenhagen HSH Nordbank, Hamburg Hyakugo Bank, Tokyo IDBI Bank Ltd, India ICAP Securities Ltd, London Iccrea Banca, Rome ICICI Bank Ltd, Mumbai Indian Overseas Bank, Chennai Indonesische Overzeese Bank, Amsterdam Industrial Bank of Korea, Seoul International Bank of Asia Ltd, Hong Kong Intesa Sanpaolo, Torino Investec Bank, London Investec Bank Ltd, Sandown Investors Bank and Trust Company, Boston Islandsbanki, Reykjavik Israel Discount Bank, Tel Aviv ISS Finans, Copenhagen ISS Global, Copenhagen Ixis Corporate & Investment Bank, Paris Iyo Bank, Tokyo Jeju Bank, Jeju Jeonbuk Bank, Seoul Joh Berenber Gossler Co., Hamburg Joyo Bank, Tokyo Juroku Bank, Gifu Jyske Bank, Silkeborg, Copenhagen Kas Bank N.V., Amsterdam Kaupthing Bank Ltd., Luxembourg Key Bank, Cleveland Korea Development Bank, Seoul Korea First Bank, Seoul Kreditanstalt fur Wiederaufbau, Frankfurt Kwangju Bank, Seoul Kyongnam Bank, Masan La Caixa, Barcelona La Compagnie de Tresorerie Benjamin de Rothschild, Geneva Landesbank Baden-Wuerttemberg, Stuttgart Landesbank Berlin AG, Berlin Landesbank Hessen-Thueringen Girozentrale, Frankfurt Landesbank Saar, Saarbruecken Laurentian Bank of Canada, Montreal LGT Bank in Liechtenstein, Vaduz Liu Chong Hing Bank Limited, Hong Kong Lloyds TSB Bank, London Lombard Odier Darier Hentsch and Cie, Geneva LRP Landesbank Rheinland Pfalz, Mainz Luzerner Kantonalbank, Lucerne Macquarie Bank, Sydney Malayan Banking Berhad (Maybank Singapore), Singapore Malayan Banking Berhad (Maybank), Kuala Lumper Man Financial Limited, London Mashreqbank, Dubai Merrill Lynch International Bank, London Merrill Lynch International Bank, New York Merrill Lynch, Pierce, Fenner & Smith, New York Metzler B. Seel. Sohn und Co., Frankfurt MKS Finance, Geneva MM Warburg und Co., Hamburg Natixis Banques Populaires, Paris Natixis Captial Market, Paris National Agricultural Cooperative Federation, Seoul National Bank of Abu Dhabi, Abu Dhabi National City Bank, Cleveland National Federation of Fisheries Cooperatives, Seoul Nationwide Building Society, Northampton Nykredit Bank, Copenhagen Nedbank, Johannesberg Nektar Asset Management New York Clearing Corporation, New York Nike Australia, Abbotsford Nike Canada, Thornhill Nike European Operations, Hilversum Nike Hong Kong, Kowloon Nike Inc, Beaverton Nike International, Beaverton Nike International Limited, Kowloon Nike Japan, Tokyo Nike New Zealand, Auckland Nike Singapore, Singapore Nike USA, Beaverton Nomura International, London, London Nomura Securities, Tokyo Norddeutsche Landesbank, Luxembourg Norddeutsche Landesbank Girozentrale, Hannover Norddeutsche Landesbank Girozentrale, Singapore Norddeutsche Landesbank Girozentrale, London Oberbank, Linz ODL Securities Ltd, London Oman International Bank, Muscat Oppenheim Sal Jr und Cie, Duesseldorf Oppenheim Sal Jr und Cie, Zurich Parex Banka, Riga PB Financial Services Inc, New York Pictet and Cie, Geneva Penson Financial Inc., Dallas PKB Privatbank, Lugano Privredna Banka Zagreb, Zagreb Privatbank Ihag Zurich, Zurich Prudential Bache Global Markets, New York Prudential Financial Derivatives Llc, New York Pusan Bank, Seoul Raiffeisen Landesbank Suedtirol, Bolzano Raiffeisen Zentralbank, London Raiffeisen Zentralbank Oesterreich, Vienna Raiffeisen Zentralbank Oesterreich AG, Singapore Raiffeisenlandesbank Oberoesterreich, Linz Raiffeisen-Landesbank Tirol, Innsbruck Raiffeisenlandesbank Vorarlberg, Bregenz Rand Financial Services, Inc., Chicago RBA-Zentralbank, Berne Refco Capital Markets, New York Renault Finance, Lausanne Resona Bank, Tokyo Ringkjobing Bank, Ringkoebing Roskilde Bank, Roskilde Sabanci Bank, London Sampo Bank, Helsinki Sanpaolo, Torino Sanpaolo Bank, Luxembourg Saraswat Co-Operative Bank Ltd, Mumbai Saxo Bank, Gentofte Seng Heng Bank, Macau Shanghai Commercial Bank Limited, Hong Kong Shinhan Bank, Seoul Shinkin Central Bank, Tokyo Shinsei Bank Ltd, Tokyo Shizuoka Bank, Shizuoka Skandia Capital, Stockholm SKF Treasury, Goteborg SMBC Capital Markets Inc, New York South African Reserve Bank, Pretoria State Bank of India, Calcutta State Bank of Travancore, Ernakulam Sucden (UK) Ltd, London Sunlight, Cham Swedbank, Stockholm Swiss Post – Postfinance, Berne Sydbank, Aabenraa Syndicate Bank, Mumbai Tai Fung Bank, Macau The Bank of Fukuoka., Tokyo The Bank of Kyoto, Kyoto The Clearing Corporation, Chicago The Gunma Bank, Maebashi The Hiroshima Bank, Tokyo The Minato Bank, Kobe The San-In Godo Bank, Matsue The Shoko Chukin Bank, Tokyo The Yamanashi Chuo Bank, Kofu Thurgauer Kantonalbank, Weinfelden Timber Hill Europe AG, Zug Top Danmark, Ballerup Toronto Dominion Bank, London Toronto Dominion Bank, Toronto Travelex America Inc., US Travelex, London Travelex, Peterborough Travelex, Sydney Trust and Custody Services Bank, Tokyo Unilever, Rotterdam Union Bancaire Privee, Geneva Union Bank of Israel, Tel Aviv Union Bank of Taiwan, Taipei Unipol Banca, Bologna United Mizrahi Bank, Tel Aviv Volvo Treasury, Goteborg VTB Bank Europe plc., Singapore Vseobecna Uverova Banka A.S, Bratislava Wachovia Bank, Charlotte WestLB, London WGZ-Bank, Duesseldorf Winterthur Einzel Treasury, Switzerland Winterthur Insurance, Switzerland Winterthur Kollektiv, Switzerland Winterthur Life and Pensions, Switzerland Winterthur Market Unit CH Treasury, Switzerland Woori Bank, Seoul Yamaguchi Bank Ltd, Tokyo Yes Bank Ltd., Mumbai *Investment funds are not listed here and some institutions have asked for their details not to be published. In certain cases some banks, corporates and NBFIs may have multiple locations, branches or subsidiary companies submitting instructions to CLS Bank.

Author: CLS Corporate Communication

Sources used in this article:

http://www.cls-services.com (various pages)

http://www.citi.com/citigroup/press/2008/080402d.htm

http://www.synthesisbank.com/en/node/593321

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Topics: Banks and banking offshore, Currencies and Cash | 1 Comment »

One Response to “The Multi-Trillion Dollar Bank You Have Probably Never Heard Of”

Peter Macfarlane & Associates » Blog Archive » Who Really Controls Your Money? CLS Bank and the Depository Trust and Clearing Corporation Says:
October 12th, 2008 at 4:29 am
[...] for Q Wealth Report on the multi-trillion-dollar bank nobody has ever heard of. You can read my blog entry on CLS Bank here, and a more detailed article in a forthcoming edition of The Q Wealth Report. A news release [...]

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