LCH Consultation on Conversion of Outstanding Cleared MXN 28D-TIIE Contracts

Report date

Circular No.: 

LCH Circular No. 4279 


17th November 2023


All SwapClear Users


The LCH group, and its SwapClear business, strongly supports the continuing industry-wide efforts to transition from existing benchmarks to risk-free rates (“RFRs”). 

Following extensive consultation with SwapClear members and clients, LCH Ltd (“LCH”) has already successfully converted SwapClear Contracts1 linked to a number of discontinued benchmarks. The most recent example is the conversion of SwapClear’s USD LIBOR Contracts into SOFR-equivalents, which was completed by SwapClear in two tranches earlier this year2 .

In recent months, and in the context of benchmarks used in the Mexican rates’ markets, Banco de Mexico (“Banxico”) has announced: i) a prohibition on the use of MXN 28D-TIIE as reference for new contracts entered into by financial entities regulated by Banxico as from 1 January 2025; and ii) a change to the methodology for the calculation of the MXN 28D-TIIE rate3

Whilst MXN 28D-TIIE is not being discontinued, we anticipate the emergence of liquidity conditions which are common to those anticipated and then experienced as a consequence of prior LIBOR/*IBOR cessations and we would make common arguments about the need to transition SwapClear Contracts away from reliance on MXN 28D-TIIE. 

Therefore, through this circular, LCH is issuing an invitation to all SwapClear users to respond to a consultation regarding the treatment of outstanding MXN 28D-TIIE SwapClear Contracts and their potential conversion into (or replacement with) corresponding F-TIIE-based SwapClear Contracts at or around 31 December 2024. 

A consultation document addressed to all SwapClear users has been published on LCH’s website, together with instructions on how to respond. 

LCH strongly encourages SwapClear participants with an interest in the Mexican market to respond to this consultation and to express their opinion on the proposed approach in order to gather the widest set of feedback possible regarding next steps. LCH requires responses by 15 December 2023. Feedback received after this date may not be considered.

Any solution will be subject to risk governance and legal and regulatory review or non-objection.
Should you have any comments or questions, or if you require further information, please do not hesitate to contact and


1“SwapClear Contract” includes an “FCM SwapClear Contract” for the purposes of this circular and the consultation. SwapClear Contract and FCM SwapClear Contract have the meanings assigned to them in the General Regulations or FCM Regulations (as applicable) and made available at 
  2LCH’s Consultation on Conversion of Outstanding USD LIBOR® SwapClear Contracts | LCH Group