Banks divided over CME’s done-away model for UST clearing
Buy side could give thumbs-up if questions on margin protection and guarantee fees are answered
A new entrant to the market for clearing cash and repo US Treasuries trades could offer a lifeline for buy-side firms looking to separate their clearing and execution providers. But some obstacles remain, including the repo desks of banks that may prefer to keep their existing clearing model.
“We are hearing there is an internal conflict between repo desks and futures commission merchants, because repo desks really lean on the sponsored model, where they can combine clearing and financing – that
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