#Financial Performance #Brussels #Belgium #Euroclear #2025 Q3

Euroclear's Financial Highlights for Q3 2025

In the third quarter of 2025, Euroclear has demonstrated solid financial results, continuing its growth trajectory over the past nine months. With the reported underlying business income reaching €1.4 billion, the organization experienced a 7% increase compared to the previous year. This growth was fueled by record deposit levels, resilient settlement activities, and a robust influx in exchange-traded fund (ETF) transactions. Moreover, the firm's effective cost management strategies have contributed to an improved operating margin of 27.4%, a 3.4 percentage point increase from the prior year.

Despite a decline of approximately 10% in interest and banking income—totaling around €800 million—primarily due to lower global interest rates, Euroclear's net interest earnings have surpassed expectations. The positive performance can be attributed to stable USD interest rates and a higher average balance of cash deposits, which climbed to €23.9 billion, marking a year-on-year rise of 7%.

Key Performance Metrics

Euroclear’s success is further complemented by its strong operational metrics:

• - Assets under custody surpassed €42.5 trillion, reflecting a 5% increase year-on-year.
• - Number of transactions processed by Euroclear reached 267 million, a 10% rise compared to the same period last year.
• - Turnover exceeded €1 trillion for the first time, hitting €1.008 trillion, marking a 19% increase.
• - With record fund assets under custody now standing at €3.8 trillion, Euroclear capitalizes on the ongoing popularity of ETFs.

Business Growth Strategies

A significant contributor to Euroclear's growth strategy has been its investment in technological advancements. Recent initiatives include the collaboration with Banque de France aimed at tokenizing Negotiable European Commercial Paper (NEU CP), which seeks to modernize the short-term debt market through distributed ledger technology (DLT). This pilot project focuses on creating an interconnected wholesale Central Bank Digital Currency (CBDC) using TARGET services from the European Central Bank (ECB).

Additionally, Euroclear is enhancing the Eurobond market's digitization in collaboration with Clearstream, targeting dematerialized Eurobonds issuance from 2026 onwards. This transition will facilitate greater automation and foster the adoption of innovative technologies throughout the Eurobond lifecycle, further benefiting the marketplace and its participants.

Responding to Challenges

In light of the ongoing geopolitical tensions and resulting sanctions against Russia, Euroclear faces unique challenges. The company reported a decrease of 25% in interest earnings from sanctioned Russian assets, totaling €3.9 billion. The European Union's regulations have required Euroclear to provision €2.6 billion for funds regarding windfall contributions, of which it has already paid €1.6 billion.

Furthermore, Euroclear is actively managing risks that arise from blocked coupon payments to sanctioned entities. As of September 2025, their balance sheet revealed €193 billion in blocked Russian assets, necessitating a cautious approach in navigating these turbulent waters. Despite the pressures from sanctions, Euroclear has maintained a solid capital position, boasting a Common Equity Tier 1 capital ratio of around 61%, well above regulatory requirements.

Future Prospects

Looking forward, Euroclear intends to assert itself as a crucial player within the European financial landscape. It remains committed to fostering a unified Savings and Investments Union across Europe, delivering tangible benefits to investors and issuers alike. This vision involves cultivating deeper liquidity pools, increasing interoperability systems, and enhancing asset class fungibility across markets.

Additionally, as Euroclear prepares to acquire a full stake in Inversis, the company anticipates that this move will accelerate its growth in fund offerings and bolster its presence in Southern European markets. With the remarkable progress achieved in Q3 2025, Euroclear is well-positioned for sustained growth while addressing challenges head-on.