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Company Circular No:

LCH.Clearnet LTD Circular No 3355

Service Circular No:

SwapClear No 100

Date:14 October 2013
To:All SwapClear Members

LCH.Clearnet Ltd - Update to Process for Portfolio Transfers Without Collateral

This circular supersedes the circular issued on 25 June 2013 on Changes to Portfolio Transfers.

The process applicable to full and partial transfers without collateral is:

All partial and full transfers from one SwapClear Clearing Member to another SwapClear Clearing Member without collateral will be processed intraday, once both the Receiving Clearing Member and the Carrying Clearing Member accept the transfer via the ClearLink API.

Historically, for partial and full transfers without collateral, as long as a transfer request was received on T (T being the date that the transfer is submitted to LCH.Clearnet Limited) by 15:00 EST, requests for consent would be sent via the ClearLink API on T+1 at 05:00 EST, and accepted transfers would be processed as part of that day’s End of Day (EOD) batch. While the timing of transfer and consent requests will not change, as a result of STP, LCH.Clearnet Limited will be processing transfers intraday versus the previous EOD process.

If both the Carrying Clearing Member and the Receiving Clearing Member would prefer to expedite transfers for processing on T, versus T+1, they must notify SwapClear Client Services via email confirmation. In this circumstance, SwapClear Client Services will attempt to process transfers on T, and provide confirmation of a successful transfer to the relevant SwapClear Clearing Members. Otherwise, transfers will process intraday, on T+1.

Clearing Members have until T+2 to accept or reject a transfer.

The Receiving Clearing Member must accept by 14:30EST on T+2, or the transfer will be rejected and a new transfer request will need to be submitted. Further, if the Carrying Clearing Member has not either accepted the transfer or filled out the Carrying Response form to notify the LCH.Clearnet Limited of a valid reason for rejection by T+2 14:30 EST, the transfer will be automatically accepted.

*Terms used herein and not defined herein shall have the meaning assigned to them in the Rulebook of FCM Rulebook of LCH.Clearnet Limited.

*References to a Carrying Clearing Member and to a Receiving Clearing Member include a Carrying FCM Clearing Member and Receiving FCM Clearing Member (as the context requires).