CME Group and FICC extend cross-margining
18 July 2023 US
Image: AdobeStock/JHVEPhoto
CME Group and the Depository Trust & Clearing Corporation (DTCC) have extended their cross-margining arrangements for the benefit of mutual clients that clear US treasuries and CME Group interest rate futures.
This will allow CME clearing members that are also clearing US government treasury securities through the DTCC-owned Fixed Income Clearing Corporation (FICC) to take advantage of additional cross-margining benefits across FICC cleared repo, US treasury notes and bonds, along with CME Group SOFR futures and Ultra 10-yr US treasury note futures, providing they are eligible for these netting benefits.
These changes are subject to regulatory approval and are expected to come into effect, if approved, in January 2024.
CME Group global head of clearing and post-trade services Suzanne Sprague comments: 鈥淭oday鈥檚 announcement builds on 20 years of our organisations working together to create efficiencies for Treasury market participants.
鈥淎s evidenced in the G30 report, cross-margining has been identified as both a market benefit and a regulatory priority in times ahead. CME Group [expands] our collaboration with DTCC to deliver greater opportunities for capital efficiencies for participants who trade across cash and futures markets.鈥�
Laura Klimpel, general manager for FICC and head of SIFMU business development at DTCC, says: 鈥淔ICC recognises the importance of this joint effort and we [are] working with CME Group to improve the efficiency and resiliency of the overall Treasury market.鈥�
This will allow CME clearing members that are also clearing US government treasury securities through the DTCC-owned Fixed Income Clearing Corporation (FICC) to take advantage of additional cross-margining benefits across FICC cleared repo, US treasury notes and bonds, along with CME Group SOFR futures and Ultra 10-yr US treasury note futures, providing they are eligible for these netting benefits.
These changes are subject to regulatory approval and are expected to come into effect, if approved, in January 2024.
CME Group global head of clearing and post-trade services Suzanne Sprague comments: 鈥淭oday鈥檚 announcement builds on 20 years of our organisations working together to create efficiencies for Treasury market participants.
鈥淎s evidenced in the G30 report, cross-margining has been identified as both a market benefit and a regulatory priority in times ahead. CME Group [expands] our collaboration with DTCC to deliver greater opportunities for capital efficiencies for participants who trade across cash and futures markets.鈥�
Laura Klimpel, general manager for FICC and head of SIFMU business development at DTCC, says: 鈥淔ICC recognises the importance of this joint effort and we [are] working with CME Group to improve the efficiency and resiliency of the overall Treasury market.鈥�
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