LCH clears over $700 million in G10 NDF in one month
- Five G10 currency pairs now available for clearing at ForexClear
- Expansion of ForexClear builds on current emerging market NDFs offering
- Record volume of over $110 billion in notional cleared across entire ForexClear service in one day, on 28 November
- Follows service’s rapid growth in clearing volumes since introduction of uncleared margin requirements
LCH, a leading global clearing house, today announced that it has cleared a total of $745 million G10 FX NDFs currency pairs through its ForexClear service. This volume was achieved within one month of the new product’s go live at LCH. By clearing these additional currency pairs at ForexClear, market participants will benefit from the efficiencies of clearing over a broader product set.
The new NDF currency pairs reflect the five most actively traded G10 currencies: Australian Dollar, Euro, Japanese Yen, Pound Sterling and Swiss Franc, against the US Dollar. Expanding ForexClear’s coverage to incorporate these pairs increases opportunities for capital optimisation, by increasing the number of products eligible for clearing at LCH.
Paddy Boyle, Global Head of ForexClear, LCH, said: “We’re pleased with the strong adoption to date of this product among our active membership. Since the advent of the uncleared margin rules in 2016, we’ve seen a tremendous surge in NDF clearing. Now that we have expanded our product set into the G10 currencies, we anticipate continued take up among our members and their clients as they seek to use their capital in the most efficient way.”
Mike Curtis, Managing Director, Business Resource Management, Nomura, said: “This gives Nomura another valuable tool for reducing Bilateral SIMM FX Risk and the costs from its associated Initial Margin.We have used LCH Cleared G5 FX NDFs in multilateral risk reduction runs and also for bilateral risk reducing trades. They are very helpful when used in conjunction with large FX Option customer novations.”
The expanded ForexClear service now clears 17 currency pairs, incorporating emerging market currencies.
For further information
Rhiannon Davies, Tel: +44 (0)20 7426 7523
Lucie Holloway, Tel: +44 (0)20 7797 1126
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 also serves the non-cleared derivatives market through LCH SwapAgent, a new service which extends the efficiencies and infrastructure of clearing to the market, without acting as a central counterparty.
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.
Further information on LCH can be found at www.lch.com
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