LCH signs MoU with CMU OmniClear
09 June 2025 Hong Kong
Image: Diki/stock.adobe.com
LCH has signed a Memorandum of Understanding (MoU) with CMU OmniClear, a wholly-owned subsidiary of the Exchange Fund.
CMU OmniClear manages the operations and business development activities of the Central Moneymarkets Unit (CMU) on behalf of the Hong Kong Monetary Authority (HKMA).
According to LCH, the collaboration will help the firm to deliver advanced risk management and capital efficient solutions to users of key Chinese Yuan Renminbi Offshore (CNH)-denominated instruments.
By using Hong Kong’s Payment versus Payment (PvP) settlement solution, LCH will extend its product scope to include the clearing and settlement of CNH FX options, forwards, swaps, and spot transactions through its FX clearing service, ForexClear.
The solution aims to enable full multilateral netting and guaranteed settlement, thereby removing a barrier to increased trading activity, the firm says.
Susi de Verdelon, CEO at LCH, says: “We are delighted to partner with CMU OmniClear, and our clearing member banks and customers, as we embark on our ambitious plans to expand our services to market participants who want to trade and settle deliverable CNH derivatives and debt securities globally.
“The APAC region continues to be a strategic focus for LCH, and we look forward to continued partnership as a greater number of financial institutions benefit from the margin, capital, and operational efficiencies that our services deliver.”
Additionally, LCH ForexClear and CMU OmniClear plan to explore the inclusion of other currencies based on initial market adoption and demand.
The new offering is to be available in the first half of 2026, and will allow settlement netting of trades executed in entities incorporated outside of Hong Kong.
Furthermore, LCH will look to expand its range of eligible collateral in 2026 to include CNH-denominated Chinese government bonds (CGBs), which will be settled and held in the CMU, pending regulatory submission and approval.
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CME OmniClear CEO Stanley Chan adds: “The collaboration between CMU OmniClear and LCH demonstrates the strong demand from global investors for CNH-denominated debt securities, derivatives, and related risk management tools.
“It also highlights the unparalleled role of Hong Kong’s payment and settlement infrastructure in supporting investment in CNH-denominated debt securities by investors from all over the world. We are pleased that CGBs held in Hong Kong’s central securities depository infrastructure will, for the first time, be accepted as eligible collateral outside of Hong Kong.”
Andrew Ng, group executive and group head of global financial markets at DBS Bank, comments: “CNH volumes have grown exponentially in recent years as the currency becomes more internationalised. This is a major development which will support financial institutions across multiple jurisdictions who want to trade CNH derivatives and benefit from the risk and margin efficiencies of clearing.
“As a leader in Asian financial markets, DBS welcomes developments that strengthen the safety, resilience, and depth of the derivatives markets in Singapore and the region. Further, LCH’s expansion of eligible collateral to include Chinese government bonds will be a particularly important step in the development of the CNH derivatives market.”
CMU OmniClear manages the operations and business development activities of the Central Moneymarkets Unit (CMU) on behalf of the Hong Kong Monetary Authority (HKMA).
According to LCH, the collaboration will help the firm to deliver advanced risk management and capital efficient solutions to users of key Chinese Yuan Renminbi Offshore (CNH)-denominated instruments.
By using Hong Kong’s Payment versus Payment (PvP) settlement solution, LCH will extend its product scope to include the clearing and settlement of CNH FX options, forwards, swaps, and spot transactions through its FX clearing service, ForexClear.
The solution aims to enable full multilateral netting and guaranteed settlement, thereby removing a barrier to increased trading activity, the firm says.
Susi de Verdelon, CEO at LCH, says: “We are delighted to partner with CMU OmniClear, and our clearing member banks and customers, as we embark on our ambitious plans to expand our services to market participants who want to trade and settle deliverable CNH derivatives and debt securities globally.
“The APAC region continues to be a strategic focus for LCH, and we look forward to continued partnership as a greater number of financial institutions benefit from the margin, capital, and operational efficiencies that our services deliver.”
Additionally, LCH ForexClear and CMU OmniClear plan to explore the inclusion of other currencies based on initial market adoption and demand.
The new offering is to be available in the first half of 2026, and will allow settlement netting of trades executed in entities incorporated outside of Hong Kong.
Furthermore, LCH will look to expand its range of eligible collateral in 2026 to include CNH-denominated Chinese government bonds (CGBs), which will be settled and held in the CMU, pending regulatory submission and approval.
?
CME OmniClear CEO Stanley Chan adds: “The collaboration between CMU OmniClear and LCH demonstrates the strong demand from global investors for CNH-denominated debt securities, derivatives, and related risk management tools.
“It also highlights the unparalleled role of Hong Kong’s payment and settlement infrastructure in supporting investment in CNH-denominated debt securities by investors from all over the world. We are pleased that CGBs held in Hong Kong’s central securities depository infrastructure will, for the first time, be accepted as eligible collateral outside of Hong Kong.”
Andrew Ng, group executive and group head of global financial markets at DBS Bank, comments: “CNH volumes have grown exponentially in recent years as the currency becomes more internationalised. This is a major development which will support financial institutions across multiple jurisdictions who want to trade CNH derivatives and benefit from the risk and margin efficiencies of clearing.
“As a leader in Asian financial markets, DBS welcomes developments that strengthen the safety, resilience, and depth of the derivatives markets in Singapore and the region. Further, LCH’s expansion of eligible collateral to include Chinese government bonds will be a particularly important step in the development of the CNH derivatives market.”
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