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Company Circular No:

LCH.Clearnet Ltd Circular No 3428

Date:17 February 2014
To:All LCH.Clearnet Ltd Clearing Members

LCH.Clearnet Ltd Change to Tri-Party Operating Procedures

LCH.Clearnet Ltd (LCH.Clearnet) currently enables clearing members to lodge securities to cover their initial margin requirements using Tri-party arrangements at Euroclear Bank and/or Clearstream Luxemburg. Where a Clearing Member submits an instruction to lodge or increase a Tri-party transaction for next day execution, LCH.Clearnet provides clearing members with cover as part of the end of day on the day prior to the settlement date (S) so long as Tri-Party instructions are matched by 17:30 on S-1 (London time).

With effect from close of business on 14 March 2014, LCH.Clearnet will no longer assume settlement and will only provide cover to clearing member accounts once the Tri-party trade has been fulfilled on S.

Members that wish to lodge or increase triparty transactions to avoid overnight margin calls should ensure that fulfilment of the transaction occurs in advance of the triparty settlement deadline that day.

If you require any further information in relation to this change, please contact Martin McCrystal on 020 7426 7237 or email martin.mccrystal@lchclearnet.com.