LCH Clearnet Ltd. plans to launch its SwapClear Futures Commission Merchant (FCM) service for U.S. clients on March 8, 2011, when all regulatory requirements are completed.
U.S. customers will access LCH.Clearnet’s SwapClear service through a U.S. based FCM of their choice. This is an important milestone in SwapClear’s supporting compliance by U.S. customers within the terms of the Dodd-Frank Act, the independent clearinghouse said.
LCH.Clearnet has been a Designated Clearing Organization registered with the Commodity Futures Trading Commission since 2001, and has cleared over 120,000 trades involving U.S. counterparties with a notional value of over $64 trillion.
“SwapClear sets the standard globally for OTC clearing,” commented Floyd Converse, head of U.S. SwapClear sales and marketing, in today’s release. “Beginning on March 8, U.S. clients will be able to access SwapClear’s unique expertise and product range within the security of the familiar FCM framework.” The SwapClear FCM model will offer U.S. customers several key benefits, including: • Reduced counterparty risk • Default protection • Proven default management expertise • Portability of client collateral and positions • Initial margin collateral held solely in the U.S. and fully subject to U.S. law and the CEA (Commodity Exchange Acxt). In addition, SwapClear’s U.S. customers will benefit from the service’s broad product range, which covers over 90 percent of the “plain vanilla” IRS market, and which will be expanded in 2011 to cover U.S. dollar denominated amortizing swaps. SwapClear currently clears trades in 14 currencies and tenors out to 50 years.
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio