Non-deliverable Interest Rate Swaps Membership and Client Fee Tariffs

Dear SwapClear Member,
 
In anticipation of the second phase of clearing for SwapClear Contracts that are non-deliverable interest rate swaps (“NDIRS”), LCH Limited hereby informs SwapClear Clearing Members of the associated fee structure. The clearing of the second phase of NDIRS, and the associated fees set out below, remain subject to regulatory approval.  Please note, fee tariffs and related fee terms set forth below supersede the NDIRS Fee Tariffs as detailed in circular No. 3941, dated 6 April 2018.

Clearing Member - Bronze Tariff, Silver Tariff and Gold Tariff†

A SwapClear Clearing Member or Member Group that has elected the Bronze Tariff, the Silver Tariff or Gold Tariff and wishes to clear NDIRS may choose either of the following fee plans:

Plan A

For an annual fee of £250,000 a SwapClear Clearing Member or Member Group may clear an unlimited amount of NDIRS denominated in the following currencies: KRW, INR, CNY, BRL, CLP, COP, THB and TWD.

Plan B

A SwapClear Clearing Member or Member Group may clear a NDIRS for a £75 registration fee plus a monthly maintenance fee of £6 per open NDIRS SwapClear Contract.

• Any SwapClear Clearing Member or Member Group currently clearing NDIRS will be deemed to auto-elect Plan B unless they instruct LCH otherwise by 1st January 2019
• A SwapClear Clearing Member or Member Group will be automatically enrolled in their existing Fee Tariff unless they instruct LCH otherwise by the 1st January of a given year
• A SwapClear Clearing Member or Member Group that is not currently clearing NDIRS will have the option to elect Plan A or B as part of the NDIRS on-boarding process.  Plan A election will be applied at a pro rated amount if on-boarding after the 1st January of the given year
• Fee Plans cannot be amended or altered during a given calendar year

Clearing Member - Platinum Tariff

All SwapClear Clearing Members or Member Groups that have elected the Platinum Tariff will have their annual fee increased from £2,550,000 to £2,800,000. The Platinum Tariff will include an unlimited amount of NDIRS denominated in the following currencies: KRW, INR, CNY, BRL, CLP, COP, THB and TWD.

SwapClear Client Clearing Fees

The fees applicable for the clearing of NDIRS for SwapClear Clearing Clients or FCM Clients will be the same as those currently payable by SwapClear Clearing Members for SwapClear Contracts that are not NDIRS (or Inflation ZCIIS) and will be payable in USD.

The Clearing House charges all fees to Clearing Members. Clearing Members individually make pricing arrangements with Clients.

Fee Holiday

In order to further facilitate the implementation of clearing for NDIRS, the Clearing House will not charge fees until 1st October 2019 (including registration, portfolio transfer and compression fees) for the following NDIRS currencies: BRL, CLP and COP for:

a)    Bronze, Silver or Gold Tariff Members electing for Plan B; and
 
b)    Client fees*

Kind regards,

LCH Relationship Management

Terms used in this circular have the meaning assigned to them in either the Rulebook or FCM Rulebook (as applicable), available at www.lch.com. The terms ‘SwapClear Clearing Member’ and ‘SwapClear Contract’ include an ‘FCM Clearing Member’ and an ‘FCM SwapClear Contract’.

*For technical reasons, maintenance fees will be payable from go-live for SwapClear Contracts entered with respect to SwapClear Clearing Clients and FCM Clients, and the fees associated shall be payable prior to1st October 2019.