Intercontinental Exchange, a leading operator of global markets and clearing houses and Traiana, the leading provider of post-trade solutions, today announced an agreement to process over-the counter (OTC) foreign exchange contracts via ICE Link, ICE’s market leading middleware service.
The extended offering will provide affirmation, regulatory reporting and clearing connectivity for OTC FX market participants in line with G20 commitments and new regulatory requirements in the U.S., Europe and Asia.
The extended service leverages Traiana’s Harmony network for global connectivity to all FX clearinghouses, banks, executing brokers, clearing brokers and trading venues. The service is an open solution supporting all FX clearinghouses globally. ICE Link clients, which constitute over 550 buy-side institutions, along with dealers and prime brokers, will use their existing ICE Link connectivity to affirm, allocate, confirm and clear OTC FX trades using Traiana’s network. In March, ICE announced that it will launch clearing for OTC non-deliverable forward FX contracts, subject to regulatory approval.
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“Combining Traiana’s unrivalled post trade FX network with the convenient connectivity offered by ICE Link into a single platform will simplify the clearing process and deliver increased operational efficiencies for J.P. Morgan and our clients,” said Dale Braithwait, global head of OTC clearing product development at J.P. Morgan.
Clive de Ruig, Global Head of ICE Link, said, “The synergies between ICE Link and Traiana Harmony create a powerful tool set for buy-side clients and will facilitate the implementation of OTC FX clearing for ICE Link clients as well as the banks and clearing brokers that serve them. We are pleased to work with Traiana on this new development.”
Andrew Coyne, CEO, Traiana said, “We are delighted to have been chosen by ICE for this key initiative. As the regulatory drive to impose clearing on the OTC derivative market continues, Traiana is committed to providing the best solutions to customers to ensure they are able to adapt to new market structures. The combined solution of Traiana and ICE link will bring great benefits to the FX industry and will help streamline the roll out of central clearing globally.”
ICE Link is the most widely adopted post trade affirmation service for Credit Default Swaps (CDS) and allows market participants to electronically affirm trade details within moments of execution. In 2009, ICE introduced the benefits of central counterparty clearing to the CDS market, firstly at ICE Clear Credit and later that same year at ICE Clear Europe. Alongside ICE Link, the introduction of central counterparty clearing for CDS instruments helped to reduce risk and bring transparency and risk management to a previously opaque and uncleared market.