Mostly… fixed income and cross product eTrading

October 16, 2008

Clearing is the new black – but nobody cares

Filed under: Client Onboarding, etrading, Nuts and Bolts, STP — holky @ 6:39 pm

Finextra reports the latest exchange looking at the OTC markets – lch.clearnet eyeing up the FX market to work out how they can get clearing involvement.

This is just days after the news confirming fxmarketspace is being closed down (by CME and Reuters) because there was not enough activity on the platform.

Given everyone’s fear of counterparty risk at this point, you’d think the timing cannot get much better for offering centralised clearing for OTC products. So why is it so difficult to onboard clients to these offerings? I can’t believe its just a documentation hurdle – sure the lawyers are probably quite busy with one thing or another at this point, but surely any business/risk manager looking to be a hero would have legal review and signing way up their todo list.

So what’s missing from the pitch?

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3 Comments »

  1. Quite simply people are more worried about saving their jobs than CCP Clearing or anything else.

    FX is one market (inter-bank anyway) that seems to be shooting the lights out in terms of volume – Icap’s EBS and Reuters TBS. so one must assume there was no need for a CCP.

    Comment by waratah — October 21, 2008 @ 1:00 pm

  2. Here you go……..

    http://www.finextra.com/fullstory.asp?id=19162

    Comment by waratah — October 22, 2008 @ 1:12 pm

  3. CME Group set to make its latest foray into over-the-counter clearing by launching a new service for booming foreign exchange markets, says Financial News …. which appears the FXmarketspace closure was a clear thanks but no thanks to Reuters (or at least, to a gui-led offering).

    Comment by holky — March 12, 2009 @ 8:02 pm


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