More than $1 trillion in buy-side client notional volumes have been cleared on the platform of LCH.Clearnet’s interest rate swap clearing service, SwapClear.
Regulatory efforts to move OTC trading into clearinghouses with legislation such as the European Market Infrastructure Regulation have intensified activity on SwapClear’s platform.
“We are delighted to see such significant buy-side activity in advance of regulatory clearing mandates,” said Michael Davie, the CEO of SwapClear. “By moving now, institutional clients are taking full advantage of a more robust infrastructure and the cost and efficiency gains of an orderly transition.”
SwapClear’s clients are capitalising on the benefits of trading on a clearinghouse, which include a reduction in counterparty risk, and operational and capital efficiencies, according to SwapClear.
Other benefits include a dealer liquidity pool of more than $300 trillion notional outstanding, market-standard pricing and operational simplicity.
Ray Kahn, the head of OTC derivatives clearing at Barclays, which uses SwapClear's services, said: “Every month this year we’ve seen an increase in the number of clients initiating their clearing process. Those buy-side participants who move to a clearing environment early are able to optimise their infrastructure and begin reaping the benefits of centralised clearing ahead of regulatory deadlines.”
