CCP
WHAT IS THIS? A central counterparty (CCP) manages default risk by collecting initial and variation margin from both parties to a trade. Spill-over losses are absorbed via a default fund to which all members contribute – introducing a degree of mutualised risk – and by the CCP’s own capital. The concept is an old one that was extended to over-the-counter derivatives in the aftermath of the financial crisis.
Clearing houses warn Esma margin rules will stifle innovation
Changes in model confidence levels could still trip supervisory threshold even after relaxation in final RTS
Compression eases capital, risk bottlenecks amid CNH swap boom
Dealers say multilateral compression for yuan cross-currency swaps can increase trading capacity
FICC to launch new default fund before UST repo clearing mandate
Clearing members expected to welcome FICC’s plans to separate loss mutualisation from margin
FICC takes record bite from MMF repo investments
Funds shift cash from the Fed’s ON RRP as cleared repos hit $1.11trn
Crypto ETFs gatecrash the US Treasury repo market
Counterparty Radar: Volatility Shares tapped $13 billion in repo funding in Q2
US hedge funds eyeing JSCC after regulations eased
FCMs see strong interest and expect funds to start clearing yen swaps before year-end
Industry groups call on EC to delay foreign CCP reporting
Trade bodies seek to prevent late-running rules causing duplicated implementation projects
How US hedge funds won big on permission to clear at JSCC
But CFTC no-action letter won’t allow netting of Japanese trades with those cleared at US FCMs
Reluctant farewell to CFTC’s clearing house recovery guidance
Market participants say withdrawn 2016 letter gave clarity to CCPs; replacement may be needed
UK CCPs see gradual shift toward foreign clearing members
North America and Asia-Pacific clearing houses remain dominated by domestic members
Volatile Q2 reshapes margin composition at top CCPs
JSCC introduces new cash collateral method, CME sees gold hit record high
DTCC’s plan to unlock billions in margin and capital savings
T+1 settlement has already cut margin; now firm is working on OCC tie-up, among 10 efficiency projects
Reporting overhaul: the EU’s near-impossible balancing act
Regulators must weigh their desire to streamline derivatives reporting against the need to gather crucial trade data
Required IM at top CCPs climbs 11% to record high in Q2
Tariff shocks and trading shifts propel surge across the board
Accounting fix brings FICC agent clearing a step closer
SEC accepts Sifma interpretation, but firms still need their own opinion and capital clarity
US banks’ OTC derivatives climb to new highs amid tariff woes
Notionals up more than 7% in largest Q2 jump on record
Tariff volatility triggers record margin calls at global CCPs
Aggregate average VM call in Q2 eclipsed pandemic highs
Ice Credit below availability target after six-hour op failure
May 5 outage longest since public disclosure began in 2015
Esma needs dose of UK agility, says official
Clearing house supervisor Giusto points to BoE consultation on Emir as example of nimbler approach
Global CCPs suffer record IM breaches in tariff-hit Q2
JSCC leads surge ahead of Eurex, CDCC, OCC and LCH
UniCredit shed €976bn of OTC derivatives notionals in 2024
Italian bank posts sole decline among EU peers through trade compression