Clearing Corporation and DTC Launch Credit Default Swap Clearing Facility

The Clearing Corporation (CCorp) and The Depository Trust & Clearing Corporation (DTCC) have signed an agreement that facilitates central counterparty services for the over-the-counter (OTC) derivatives marketplace. The initiative will roll out in the third quarter of 2008 and will be fully implemented in several product specific phases in 2008-2009.

Under the agreement, CCorp members will benefit from CCorp's netting and risk management processes and will leverage the asset servicing capabilities of DTCC's Trade Information Warehouse. The Warehouse is the industry's only global repository and centralized post-trade infrastructure for servicing OTC credit derivatives contracts throughout their multi-year lifecycles. The agreement with DTCC will allow CCorp members to utilize CCorp as the central counterparty guarantor for OTC contracts in credit derivatives, while continuing to utilize the Warehouse as the golden record for net open positions and for post trade event processing.