Schroders first European asset manager to clear with LCH ForexClear

Report date
Summary
  • Schroders becomes first European asset manager to clear with LCH ForexClear
  • Strong growth recorded across LCH ForexClear services with a record $19.1 trillion cleared in total notional in first nine months of 2022, up 17% year on year
  • Q3 2022 sees record quarter for non-deliverable FX client clearing volumes at $140 billion, 146% higher than in Q3 2021
  • LCH ForexClear offers expert risk management for FX NDFs, FX Options, FX Spot and FX Swaps & FX Forward Outrights*
Body

LCH ForexClear today announces that Schroders, a leading asset manager, managing £731.6 billion of wealth and investments, has become the first European asset manager to clear through its services. Schroders cleared NDF trades across a broad range of Asian and Latam currency pairs. Citi, a member of ForexClear, facilitated the trades as Schroders’ clearing broker. 

LCH ForexClear continues to see impressive growth of its FX client clearing service as increasing numbers of buy-side firms recognise the importance of margin and operational efficiencies, and enhanced risk management available through FX clearing. A record $370 billion in non-deliverable FX client clearing volumes were registered in the first nine months of 2022, 110% higher than the same period of 2021. 

James Pearson, Head of ForexClear, LCH, said: “With Phase 6 of the Uncleared Margin Rules implemented from September 2022, ForexClear has seen a growing number of firms choose to clear their FX trades. We warmly welcome Schroders as the first European asset manager as it looks to benefit from the margin, capital, operational and credit efficiencies available through FX clearing. We look forward to partnering with Schroders and others in expanding our product offering from NDFs to also include Options, Forwards & Swaps.”

Stephanie Whitford, Global Head of Derivatives Services, Schroders, said: “Implementing ForexClear is an important step in increasing our central clearing capabilities for our global clients. ForexClear offers increased transparency, reduces counterparty risk and strengthens liquidity in the FX market. Schroders are delighted to be the first European asset manager utilising this service and will be looking to increase our client and clearing broker usage over the coming months.”

Thomas Treadwell, Director, EMEA Head of Clearing and FXPB Product Platform, Citi, said: “We are supportive of the capital, risk management and operational efficiencies of NDF clearing. In addition to clearing FX via the FCM model, we have expanded our connectivity to our UK and EU legal entities on the international clearing model, providing clients with increased global access options. We are excited to support Schroders as they avail of the benefits of NDF clearing.”

 

* The FX deliverable service is currently available only to non-FCM ForexClear clearing members when clearing for their house account. For more info visit: ForexClear | What We Clear | LCH Group 

For further information
Nandeep Roopray / Harriet Leatherbarrow
Tel: +44 (0)20 7797 1222
Email: newsroom@lseg.com   

About LCH
LCH Limited and LCH S.A. (collectively, “LCH”) are leading multi-asset clearing houses that provide 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 extensive choice and efficiencies to the marketplace. 

LCH operates clearing houses incorporated in the UK and France, with offices in the United States and 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. In addition, SwapAgent Limited serves the non-cleared derivatives market through its SwapAgent service, which extends a number of the efficiencies applicable to clearing to the market, without acting as a central counterparty. 

LCH Limited, LCH S.A. and SwapAgent Limited are each majority owned by London Stock Exchange Group PLC (LSEG.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.