The financial crisis has brought the problems of regulatory failure and unbridled counterparty risk to the forefront in financial discussions. In the last decade central counterparties have been created in order to face those insidious problems. In Mexico both the stock and the derivatives markets have central counterparties but the money market has not. This paper addresses the Issue of creating a central counterparty for the Mexican money market. Recommendations that must be followed in the design and the management of risk of a central counterparty given by international regulatory institutions are presented in this study. Also two different conceptual designs for a central counterparty appropriate for the Mexican market are proposed. Final conclusions support the creation of a new central counterparty for the Mexican money market.

The Instituto para el Depósito de Valores (INDEVAL) is the Central Securities Depository of Mexico. It is the only Mexican institution authorized to perform, in an integrated manner, the activities of safe-keeping, custody, management, clearing, settlement and transfer of securities. In this article, we report the modeling, simulation and analysis of a new Securities Settlement System (SSS) implemented by INDEVAL, as part of a project for the implementation of a safer and more efficient operating system. The main objective of this research was to use reduced amounts of cash and securities, within reasonable periods of time, for the settlement of securities of the Mexican market. A linear programming model for the netting and clearing of operations was used. The performance of the new SSS was evaluated by performing experiments using a deterministic simulation model under different opera...