IntercontinentalExchange (NYSE: ICE), a leading operator of regulated global futures exchanges, clearing houses and over-the-counter (OTC) markets, today announced that in its first week of operation, ICE Clear Europe cleared euro5.9 billion ($8.4 billion) in credit default swap (CDS) indexes.
ICE began clearing the iTraxx index contracts on July 27 through ICE Clear Europe's CDS clearing operations. During its first week, ICE Clear Europe cleared 141 transactions totaling euro5.9 billion of notional value, and resulting in euro382.5 million of open interest. Each of the initial clearing members participated during the first week.
Said Paul Swann, President of ICE Clear Europe: "The successful launch prior to the July 31 deadline coupled with the participation by each initial member demonstrates the industry's commitment to improving the transparency, standardization and counterparty risk profile in the CDS markets. We commend these participants for their leadership in solving for these objectives in both Europe and in the U.S. We look forward to delivering our segregated funds offering to buy-side participants in October."
ICE Clear Europe, which also provides clearing services for ICE's futures and OTC energy markets, has established a separate risk pool for clearing CDS, including a guaranty fund and margin accounts, as well as a dedicated risk management system and governance structure. Through its U.S. CDS clearing arm, ICE Trust((TM)), and now ICE Clear Europe's European CDS clearing effort, ICE brings a common infrastructure to global CDS market participants within their respective regulatory jurisdictions, while leveraging clearing systems and risk management processes already in use by the industry. ICE Trust has cleared $1.7 trillion in North American CDS indexes to date.
Initial CDS clearing members at ICE Clear Europe include: Bank of America, Barclays, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, J.P. Morgan, Morgan Stanley and UBS.