The world's principal clearing organisations have formed a new association, CCP 12, dedicated to improving global clearing, netting and central counterparty (CCP) services.
A central counterparty is an organisation which guarantees trades and settlement at or after the time of trade.
CCP 12 has identified several issues it will address. These include improved information sharing, the enhancement of collateral usage, development of collaborative opportunities plus the identification of minimum standards for risk management practices.
Members include the Australian Stock Exchange Limited (ASX), The Canadian Depository for Securities Limited (CDS), Clearnet, The Depository Trust & Clearing Corporation, New York; Eurex Clearing AG, Frankfurt; Hong Kong Exchanges and Clearing Limited (HKEx) and the London Clearing House (LCH); Singapore Exchange Limited (SGX)/The Central Depository (Pte) Limited and Tokyo Stock Exchange.
Patrice Renault, CEO, Clearnet, has been elected chairman of CCP 12 for a one-year period. The role is to represent CCP 12 in other forums and co-ordinate CCP 12 working groups addressing specific issues. Renault says: "We believe that CCP 12 will encourage the industry dialogue needed to bring common standards, promote best practices and achieve interoperability."
Walter Reisch, executive vice-president, Hong Kong Exchanges and Clearing, has been designated vice-chairman and will take over as chairman for the second year. Reisch says: "As institutional investors, investment banks and securities firms have become more demanding and global, there is increasing pressure on CCPs. We must respond to our customers' needs to improve efficiency and reduce the risk and cost of clearing."
CCP 12 will hold general membership plenary sessions about every six months. In the interim, specific topics will be addressed by specialist working groups which were formed at the most recent meeting. Collateral management will be chaired by George Hender of The Options Clearing Corporation, linkages by Peter Axilrod of The Depository Trust & Clearing Corporation and risk management and best practice will be chaired by Andrew Lamb of London Clearing House.
The next CCP 12 plenary session is planned for November.