LCH wins LSE clearing contract
Under the terms of the agreement, LCH will reduce its fees for trades on the LSE by 25%. This will come into effect from January 2004. The LSE has also negotiated the contract without a lock-in period, preferring a 12-month notice period. Officials hope this will help to preserve the competitive climate that has brought about the reduction in costs.
In addition, Euronext has ceded a seat on the board of LCH Clearnet to the LSE, in order to ensure a greater level of neutrality of the board at the clearing house.
The merger of the LCH with Clearnet had provided the stimulus for new contract negotiations. Clara Furse, chief executive officer of the LSE, said the merger had changed the landscape into one of for-profit central counterparties. “We are grateful for the support of our customers that enabled us to achieve substantially improved terms for them and for the exchange,” she said.
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