LCH.Clearnet extends OTC clearing to down under 12 December 2012London Reporter: Georgina Lavers
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LCH.Clearnet will extend its clearing business for OTC interest rate instruments to Australian banks.
The firm will apply for an Australian clearing and settlement facility license that would enable it to offer its SwapClear OTC interest rate swap clearing to Australian banks, allowing them to join the existing services used by 70 international bank members.
Four of Australia's five domestic banks have submitted letters of intent to use LCH.Clearnet's SwapClear to clear interest rate swaps.
Ian Axe, CEO of LCH.Clearnet said: "While all business plans are subject to regulatory approval, our discussions with the Australian regulators continue to be very positive, and we are planning to submit our application in the first quarter of next year."
LCH.Clearnet's decision whether to offer clearing for cash equities in Australia will depend on the outcome of the Council of Financial Regulators work on competition in the clearing and settlement in this market. Its SwapClear service currently clears A$3.9 trillion in Australian dollar denominated swaps.
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