increase, the benefits from multilateral netting at an industry level have become increasingly important. before i briefly share with you how our participation in the cls has grown over the years, allow me to go down memory lane for a short while. foreign - exchange settlement risk – being the risk that originates from a situation where, in a foreign - exchange trade, one party has irrevocably paid a currency and the counterparty subsequently fails to meet its side of the deal by not delivering the other currency on time – captured the attention of regulators as a major source of systemic risk following the spectacular collapse of bankhaus herstatt in germany in 1974. the creation of the cls goes back to regulatory concerns around the collapse of bankhaus herstatt. in march 1996, the committee on payment and settlement systems ( cpss ) at the bank for international settlements ( bis ) published the so - called allsopp report titled settlement risk in foreign - exchange transactions – a strategy for addressing foreign - exchange settlement risk. this report called for action from the private sector to address settlement risk in the foreign - exchange market. the response of the private sector led to the establishment of the cls and the launch of the cls system with 39 members and seven currencies : the bis central bankers ’ speeches australian dollar, canadian dollar, euro, japanese yen, swiss franc, uk pound sterling, and us dollar in september 2002. since then, the system has evolved to the current state where foreign - exchange transactions in 17 currencies are settled with a peak volume to date of over 2 million transactions per day and a peak value of more than us $ 10 trillion per day. in its evolution, the cls added four more currencies in september 2003 : the danish krone, norwegian krone, singapore dollar, and swedish krona. in december 2004, a further four currencies were added to the settlement service, namely the hong kong dollar, korean won, new zealand dollar, and south african rand. the currencies of israel and mexico were implemented on the system in 2008. joining the cls in 2004 was a major achievement for south africa given the stringent eligibility criteria. in briefing parliament at the time about the risk management, liquidity, and efficiency benefits of the cls system, then minister of finance, mr trevor manuel, put it rather succinctly, and i quote : “ the inclusion ( … ) demonstrates that the south african payment system provides

daniel mminele : ten years of inclusion of the south african rand in the cls remarks by mr daniel mminele, deputy governor of the south african reserve bank, at the continuous linked settlement ( cls ) reception to mark ten years of inclusion of the south african rand in the cls, johannesburg, 17 march 2015. * * * good evening, ladies and gentlemen. it is an honour for me to make a few remarks on this occasion of the cls reception to mark ten years of settlement of the rand in the cls system. i am particularly pleased that the cls delegation to mark this key milestone is led by none other than the chairman of the cls board, mr kenneth harvey. we welcome you and your colleagues to south africa, and thank you for coming all the way. the cls is one of those mission - critical systems that can be compared to the plumbing system of a building. just as most of us never think about the plumbing of a building and take for granted that it is there and works, the cls also runs very much in the background of the foreign - exchange market. it is only when there is a leak or a pipe bursts that we realise how important plumbing is. in the context of the cls, if a big pipe bursts and cannot be fixed quickly, this can result in major disruptions to the foreign - exchange market, with potential rapid spill - over effects to the rest of the financial system, which at worst could bring about financial instability on a global scale. as many of you will know, the cls plays a fundamental role in the foreign - exchange market, where it operates the largest multi - currency cash settlement system to mitigate settlement risk for the foreign - exchange transactions of its members and their customers. in its offering, the cls mitigates settlement risk through the provision of its unique payment - versuspayment settlement service which has direct links to the real - time gross settlement ( rtgs ) systems of the currencies it settles. in addition to mitigating settlement risk, the cls also contributes to streamlining and standardising foreign - exchange operations, helping to reduce costs. a foreign - exchange settlement usually requires potentially large cash funding liquidity to settle the obligations of settlement members. these values are materially reduced in the cls system through the multilateral netting of the obligations between member banks to deliver best - in - class liquidity management. as regulatory requirements for larger liquidity buffers