Newedge has cleared its first OTC interest rate swap (IRS) contract. It is believed to be the first IRS contract cleared on CME Clearing by a non-traditional OTC swap dealer.
The clearing process was supported with a default management agreement between Newedge as a futures commission merchant member of CME and its two bank shareholders, Societe Generale CIB and Crdit Agricole CIB.
Driven by new regulation, the market for OTC clearing is transforming, says Nicolas Breteau, CEO at Newedge. Such change provides a real opportunity for us as an agency broker to leverage our expertise in clearing of exchange-traded derivatives and OTC commodity swaps, expand our offering, and add value for clients.
Kim Taylor, president of CME Clearing, adds: “We are pleased that Newedge has cleared their first client IRS trade with CME Clearing. We continue to work with both the buy and sell side, including FCMs such as Newedge, to identify capital and operational efficiencies that ease their transition to central clearing.
(CG)