LCH welcomes the work underway at national, EU and international level to improve transparency of CCPs' risk management policies and procedures and further strengthen their resilience.
Recent debate on the issues of recovery and resolution has focused on a CCP's total loss absorbing capacity and the size of a CCP's own resources. However, in our view the risks to which CCP members are exposed are different to those of a CCP operator, such as LCH; the debate has blurred the distinction between the resources of the clearing members and those of the CCP operator.
The paper outlines our approach to three key areas which have been the subject of this debate: risk management; recovery; and resolution. Based on our broad product experience and extensive geographic reach, we also outline some key principles that we believe should guide legislators' work in defining CCP recovery and resolution regimes globally.
Link to the White Paper release http://www.lch.com/documents/731485/762448/final+white+paper+version+three.pdf/1d1700aa-a1ae-4a6c-8f6f-541eec9b7420
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LCH is a group of leading multi-asset clearing houses that provides proven risk management capabilities across a range of asset classes. As demand for robust clearing services continues to grow, LCH is committed to maintaining the highest standards of risk management across all our services.
As the markets’ partner, LCH operates an open access model, offering a choice of execution venues, delivering unprecedented choice and efficiencies to the marketplace.
LCH operates clearing houses around the world, with clearing houses incorporated in the UK, France and the United States with additional offices in the Asia Pacific region. It offers clearing services across asset classes including OTC and listed rates; CDS and FX; fixed income; commodities; cash equities and equity derivatives.
LCH is majority owned by London Stock Exchange Group (LSE.L), an international markets infrastructure business that sits at the heart of the world's financial community.