Mandatory client clearing in Japan starts with low volumes

Dealers say some domestic firms may have found way to avoid clearing


Japan has become the first major market in Asia to mandate client clearing of interest rate swaps and its phased approach has so far resulted in no serious problems, yet volumes were low on the first day of trading.

The Japan Financial Services Agency (JFSA) requirement for client clearing came into force on December 1, catching nearly 40 financial institutions with more than ¥1 trillion ($8.4 billion) in notional swaps outstanding. With voluntary client clearing already in place, market partici

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