Source: Eurex Clearing
Eurex Clearing, Europe's leading clearing house, announced today major enhancements of its over-the-counter (OTC) clearing offering.
As of 1 July 2008, Eurex Clearing will introduce a Multilateral Trade Registration (MTR) facility and a new deal-based pricing structure for equity options. The MTR allows brokers to enter block trades with one buyer or seller and multiple counterparties instead of entering separate bilateral block trades. Regardless of the number of partial executions, Eurex Clearing will charge only one price per deal.
Additionally, to encourage volume growth from the OTC market, Eurex Clearing announced further enhancements to its fee schedule by reducing fee caps for large OTC block trades.
Thomas Book, member of the Eurex Executive Board and responsible for clearing, said "the new functionalities and pricing make it even more attractive for bilateral OTC transactions to benefit from central risk management and straight-through processing through Eurex Clearing."
"We expect to see the trend towards central clearing in the large OTC market continuing and expect to attract additional volume for Eurex", added Michael Peters, member of the Eurex Executive Board in charge of sales and marketing.
Fee caps for block trades will be reduced to 200 EUR for customer account transactions in all equity options as of 1 July 2008. This is a reduction of 50 percent for German, Swiss and Scandinavian equity options. In order to stimulate proprietary trading, fee caps for block trades on proprietary accounts are set even lower, at 100 EUR for all equity options, giving a minimum reduction of 50 percent and a maximum of 75 percent depending on the underlying.
Also as of 1 July 2008, fees for single stock futures will be significantly reduced for on-exchange order book trading and entries of OTC transactions.
Fees for order book trading will be reduced for all single stock futures to 0.20 EUR per contract. Currently, most single stock futures are priced at 0.30 EUR. Additionally, fee caps for block trades will be lowered to 200 EUR for all single stock futures.
Eurex Clearing is the largest clearinghouse for OTC transactions in Europe with a volume of 197 million transactions cleared in Q1 2008. According to a White Paper on The Global Derivatives Markets recently published by Deutsche Börse and Eurex, over-the-counter trading accounts for 84 percent and on-exchange trading only for 16 percent of the notional amount outstanding in derivatives.
In order to better promote the benefits offered by Eurex Clearing to its customers, Eurex today also announced that Eurex Clearing from today will operate under its own brand. The new Eurex Clearing brand emphasizes the advantages of central clearing and the integrated business model of Eurex and Deutsche Börse. It will enable Eurex Clearing to better position its service offerings and innovations for its industry partners. It also underlines Eurex Clearing's commitment to advanced real time risk management solutions, state-of-the-art technology and competitive clearing services.