banks' foreign exchange trades to settle simultaneously rather than the two-stage process used now. That way there is no risk that an institution could

pay for an FX trade, but not receive the currency it paid for because its counterparty has gone out of business during the day.

CLS members' FX trades will settle in a five-hour stretch during the Central

European morning. CLS could eventually allow for speedier settlements than the two-day period now common for spot FX trades.

Members can provide CLS settlement for others, and officials at some

member banks expect to see demand not only from smaller banks and financial companies, but from nonfinancial corporations. They say corporates that trade

foreign exchange can benefit from the risk reduction and netting that CLS offers.

But it's unclear whether any of that will appeal to corporates. Jeff Wallace,

managing partner at Greenwich Treasury Advisors, in Greenwich, Conn., says corporations aren't that worried about settlement risk because they trade only

with banks that have good credit ratings, and because they know the central banks stand behind the banks.

Wallace also says that netting isn't always a goal. Many corporate FX trades

are done to obtain currency to make payments, in which case the corporation needs the gross amount of currency it has purchased. "It's hard for me to see

[companies] other than the Fortune 10 being much interested" in settling through

CLS, he says.

Rob Bolton, a senior project manager at HSBC, says that CLS isn't just about

risk reduction. It can provide corporations with "a whole range of cash management and payment management benefits." Corporate treasuries using

CLS will have better information about their payments and will find out more quickly if a trade fails to settle, he says.

Uncle Sam OK's Web Payments

The Internal Revenue Service has ratcheted up its effort to modernize by

enabling corporations to pay their federal taxes online.

Launched last month, the Internet version of the IRS' Electronic Federal Tax

Payment System (EFTPS), formally known as EFTPS-OnLine (www.eftps.gov), builds on the existing EFTPS, which permits companies to

pay taxes via telephone through a software package.

The Internet version provides new features for taxpayers, the IRS says,

including access to up to 120 days of payment history and the ability to print out documentation of each transfer.

How Does Your Time Online Stack Up?

Senior financial executives spend an average of 11 hours a week on the

Internet, according to a Financial Executives International survey.

What are they doing? The most popular activity is e-mail, cited by 90.4% of

the 806 executives surveyed. The least popular is conducting business financing transactions, cited by 8.7%.

Obtaining business leasing information constitutes 75% of financing activity

conducted online, with just 12% of the respondents having completed a leasing transaction online.

The study also shows that 86% of the executives predict the Internet will help

them do their jobs more effectively over the next three years.