LCH.Clearnet has launched a new repo clearing service called RepoClear GC with a range of standardised pan-European government bond baskets, classified by credit rating.
Further baskets may be added in due course following market consultation.
RepoClear GC provides a mechanism for repo market participants to address their euro funding needs more effectively by allowing them to move the collateral that underlies their repo trades quickly and easily. Repo dealers can trade either anonymously on the electronic screen-based trading systems of ICAP Electronic Broking and MTS Italy or through voice brokers. RepoClear GC trades can be cleared on an overnight, term and forward start basis.
RepoClear GC maximises settlement netting opportunities for participants. Each day RepoClear only instructs settlement of participants net basket positions and should therefore reduce markedly the amount of bonds requiring settlement on a daily basis.
“LCH.Clearnet is excited about the potential for this new service particularly in light of the strong performance of the corresponding Sterling GC service that we introduced last year. The development of RepoClear GC has demonstrated how, through working closely with our strategic partners in the trading and settlement arenas, LCH.Clearnet is committed to creating and developing innovative new products and services for our customers,” says John Burke, director of Fixed Income, LCH.Clearnet.
“Many Repo traders and firms have long supported the creation of this RepoClear GC facility with LCH.Clearnet. Recent turmoil in the markets has shown the need for a robust and efficient financing tool that can only be optimal through the use of a central counterparty. We are pleased to be able to promote and support this new product on the BrokerTec electronic trading system for both ICSD’s and believe this will boost Euro zone liquidity and trading opportunities in the Repo markets,” adds
John Edwards, director of Fixed Income, ICAP Electronic Broking.