The new client clearing service is scheduled to be launched in the second half of 2009. LCH.Clearnet says it will follow the current clearing model, but will have additional functionality to support the segregation of client portfolios and margin. Clients will be able to access the service through a SwapClear clearing member, thereby reducing counterparty credit risk.

Joe Reilly, director of SwapClear, LCH.Clearnet says the move will help reduce systemic risk and improve market transparency.

"The broadening of SwapClear's offering to include buy-side trading clients will significantly increase the proportion of important entities able to access clearing in the rates market," he says. "We are working hard with our membership to produce a solution that is supported both by the key liquidity providers in the market and the buy-side, thereby ensuring our offering is fully attuned to the whole market's needs."

SwapClear currently lays claims to over 60%, or $85 trillion outstanding notional, of the global interbank interest rate swap market, clearing trades in 14 currencies with a tenor of up to 30 years.