LCH.Clearnet Says Way Now Open To Launch NDF Clearing Service
March 13 2012 - 11:29AM
Dow Jones News
The U.K.'s financial regulator has given LCH.Clearnet Group Ltd.
(LCHC.YY) the green light to launch a clearing service for
over-the-counter currency non-deliverable forwards, the company
said Tuesday.
London's biggest clearing house said it will now work with its
members towards launching the service without giving a time frame,
after the Financial Services Authority said it had no objections to
the move.
The London and Paris-based company, which is in the process of
being taken over by the London Stock Exchange Group PLC (LSE.LN),
said it may also look at clearing other foreign exchange
derivatives.
According to the European Union's European Markets
Infrastructure Regulation and the U.S. Dodd-Frank Act, foreign
exchange NDFs and options need to be cleared by a central
counterparty or CCP. It remains unclear how other foreign exchange
derivatives will be treated as a result of the new legislation.
The Chicago-based CME Group Inc (CME) already clears NDFs in the
dollar against the Chilean peso and plans to expand that service to
other currency pairs.
-By Alexandra Fletcher, Dow Jones Newswires, 44 20 7842 9462;
alexandra.fletcher@dowjones.com @djfxtrader
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