LCH.Clearnet Initiates Expansive Clearing of European Credit Derivatives

LCH.Clearnet has embarked on an initiative to consolidate the clearing of credit default swaps (CDS) along with some of CDSClear’s

Global clearinghouse, LCH.Clearnet SA, has announced implementation of its CDSClear service, which has begun clearing Markit iTraxx Senior Financials Indices, according to an LCH.Clearnet statement.

LCH.Clearnet has embarked on an initiative to consolidate the clearing of credit default swaps (CDS) referencing banks, in conjunction with some of CDSClear’s clearing members.

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In particular, CDSClear has seen an expansion to its eligible product suite to include a number of instruments fueled by member demand. These include senior financials, which are credit default swaps and CDS indices that reference major European financial institutions.

Overall, LCH.Clearnet has reported the following products for clearing eligibility via CDSClear:

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  • iTraxx Senior Financial Indices from Series 5 onwards, 5Y & 10Y tenors
  • All 36 Single Names that have ever been a constituent of the indices
  • Clearnet is the only EMIR-authorized clearing house to clear credit default swaps and offers the broadest European coverage of any CCP, clearing 300+ single-name CDS and 73 index series.

According to Frank Soussan, Global Head of CDSClear, LCH.Clearnet, in a recent statement on the clearing capabilities, “We’re delighted to extend our product suite, following rigorous risk reviews and testing.”

“This launch is a testament to CDSClear’s commitment to innovation and providing robust risk management to the market. We’re seeing significant demand for clearing these products as members strive to efficiently manage their margins,” he added.

Last month, LCH.Clearnet made headlines after Societe Generale Prime Services reported that its Futures Commission Merchant (FCM) conducted its first customer Non-Deliverable Forward (NDF) cleared trade with LCH.Clearnet’s ForexClear service acting as the clearinghouse.

The LCH.Clearnet Group is a global clearinghouse boasting comprehensive multi-asset capabilities – it serves a number of the world’s leading exchanges and trading platforms as well as a range of Over-the-Counter (OTC) markets. LCH.Clearnet Group is majority owned by the London Stock Exchange Group (LSEG).

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