LCH.Clearnet Group Limited (LCH.Clearnet), the multi-national clearing house, today announced that its US-based entity LCH.Clearnet LLC launched a US-domiciled interest rate swap clearing service.
This new service expands SwapClear's market-leading interest rate swap offering and demonstrates the importance of the US to LCH.Clearnet's geographic expansion strategy.
SwapClear's US-domiciled service is the first to be available through LCH.Clearnet LLC and is a direct response to client demand for a domestic clearing service in the US.
"This launch is part of our long-term growth strategy in the US, and we will continue to seek new opportunities to expand our business in this important market," said David Weisbrod, CEO of LCH.Clearnet LLC. "Proven risk management, liquidity and choice are always in demand."
Executing brokers and futures commission merchants (FCMs) from 10 major firms (Barclays, BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, J.P. Morgan, Morgan Stanley, Nomura and UBS) have joined the US-domiciled service from day one, with further major firms expected in the coming months.
SwapClear's US-domiciled service leverages its global platform which clears over 90% of cleared interest rate swaps for buyside clients. The new service will mirror SwapClear's existing product range, risk management, technology and operational platform. Headquartered in New York City, the new service is governed by New York law and regulated by the CFTC.
"LCH.Clearnet is an active buy-side partner for segregation of client collateral, which we fully support," said Richard Prager, Head of Global Trading at Blackrock. "The US DCO promises not only to enhance client asset protection, but provide asset managers with the functionality necessary to efficiently clear interest rate swaps."
"The launch of this new service reinforces our market-leading position in the US," said Daniel Maguire, Managing Director, SwapClear. "FCMs, their clients and dealers will all benefit by leveraging the same proven risk management framework, breadth of product offering and real efficiencies that the existing SwapClear service provides."