LCH.Clearnet’s SwapClear members have eliminated $284.3 billion in notional in the first triReduce and SwapClear compression cycle for cleared South African rand (ZAR) interest rate swaps.
The $284.3 billion in notional represents 25 percent of SwapClear’s outstanding ZAR notional and the 18,000 trade sides terminated accounted for 31 percent of its outstanding ZAR trade count.
With the completion of the ZAR cycle, TriOptima and SwapClear now offer multilateral triReduce compression cycles in 10 currencies.
The total eliminated by LCH.Clearnet’s SwapClear members in triReduce cycles at the end of August reached $330 trillion, $126 trillion in 2014 alone.
TriOptima has eliminated more than $500 trillion in both cleared and uncleared credit, interest rate and commodity swaps since it began offering its triReduce service in 2003.
Daniel Maguire, global head of LCH.Clearnet’s SwapClear, said: “Compression is gaining momentum as the participation in this first triReduce and SwapClear ZAR cycle demonstrates.”
“The industry recognises that it is the right move to help control operational and credit risk and minimise capital costs.”
“Managing systemic risk is equally as important for South Africa as it is for any other jurisdiction, hence our dedication to providing ZAR-denominated internal revenue service clearing and compression solutions to market participants in the region.”
Currently triReduce offers compression in: 10 cleared and 27 uncleared interest rate swap currencies; cross currency swaps; credit derivatives; and commodity swaps.
Inflation swap and foreign exchange forward compression cycles will be introduced soon.
