CORRECTED - European securities depositories launch settlement JV

(Corrects paragraph four after Clearstream spokesman says JV will handle only settlement, not clearing and settlement)

By Peter Starck

FRANKFURT, March 31 (Reuters) - Seven European companies that handle post-trade securities market services are about to launch a joint venture to handle the settlement of transactions.

The joint venture, to be unveiled in Madrid on April 2, according to an invitation received by the media, is an industry response to pressure from the European Commission for lower cross-border securities trading costs.

"Seven leading European Central Securities Depositories ... will be presenting a joint venture," the invitation said.

The participating companies include the settlement arms of German stock exchange operator Deutsche Boerse (DB1Gn.DE: Quote, Profile, Research) and Spain's BME (BME.MC: Quote, Profile, Research), but not the corresponding units of the London Stock Exchange (LSE.L: Quote, Profile, Research) or NYSE Euronext (NYX.N: Quote, Profile, Research) (NYX.PA: Quote, Profile, Research), Europe's biggest stock markets.

"The deal we are going to announce deals with settlement only," a Clearstream spokesman told Reuters, adding that none of the seven central securities depositories involved were active in the clearing of transactions.

Cross-border post-trade costs vary widely across Europe. A Berlin stock exchange board member told Reuters this month that such costs could be in double-digit euros per transaction, compared with an on-exchange trade cost of less than 0.5 euros.

Industry watchers said the joint venture looked like a response to the European Central Bank's Target 2 Securities (T2S) project, where the central bank would take over settling shares and bonds traded in euros from the private sector.