FX Market Cleared Volumes Exceed $1 Trillion Notional

07 August 2013

LCH.Clearnet Ltd, the UK-based CCP and subsidiary of the world’s largest multi-national clearing house, has cleared over one trillion US dollars in FX Non Deliverable Forwards trades (NDFs) since launching its award winning ForexClear service in March 2012.

The growth in FX central clearing comes well ahead of the anticipated regulatory clearing mandates and the implementation of Basel III which will incentivise clearing by increasing the capital requirements associated with bilateral (non-cleared) trades.

ForexClear has evolved in line with changing regulation to help users meet the new requirements. In January the service began to support regulatory reporting of FX trades in the US. Then in March, to meet CFTC regulations, ForexClear introduced straight through processing; this minimises the time during which market participants face bilateral counterparty risk before a trade is taken up by LCH.Clearnet to a few seconds.

Gavin Wells, CEO of ForexClear, said: “We are seeing the transition to clearing well ahead of the new regulations and clearing mandates as participants come to understand the associated economic benefits. ForexClear’s success is based upon our ability to anticipate user requirements and implement timely and practical solutions. This important milestone validates our collaborative approach, and we look forward to working with both buy-side and sell-side participants alike to ensure we continue to meet their needs as the cleared FX market evolves.”

15 members now benefit from ForexClear’s world-class risk management framework and broad offering of 11 currencies, which cover 95% of the NDF market. Access to ForexClear is via either Traiana’s Harmony CCP Connect or MarkitSERV’s CCP Gateway services.

In response to member and client demand, ForexClear’s client clearing offering is now complete and set to launch ahead of anticipated regulatory FX clearing mandates. This will broaden participant access and enable the buy-side to meet forthcoming regulatory obligations whilst giving them the benefits of quality risk management and superior protection through segregation of margin collateral.

For more information on LCH.Clearnet visit www.lchclearnet.com/media_centre

Contact: Kamyar Naficy +44 (0) 20 7426 3787  

About LCH.Clearnet

The LCH.Clearnet Group is a leading multi-asset class and multi-national clearing house, serving major exchanges and platforms as well as a range of OTC markets.

LCH.Clearnet’s world-class risk management framework provides exceptional levels of protection to international markets, as has been proven through the management of recent defaults. As demand for robust clearing services continues to grow, LCH.Clearnet is committed to achieving the highest standards of risk management across all asset classes cleared.

LCH.Clearnet is majority owned by London Stock Exchange Group (LSE.L), a diversified international exchange group that sits at the heart of the world's financial community.

For more information on LCH.Clearnet visit www.lchclearnet.com/media_centre.