London likely to lose all euro repo clearing business

Fear of post-Brexit curbs on clearing and netting concerns propel shift to eurozone

Twin pressures on the clearing of euro-denominated repurchase agreements in London are likely to push the business to the eurozone, and it may happen even before the UK leaves the European Union, the market’s participants predict.

They point the finger at the prospect of LCH’s London entity – which is the sole clearer of repos in the UK – being barred from clearing for EU firms after Brexit. Those fears are accelerating an existing shift in liquidity driven by a new pan-EU settlement platform,

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