Swiss Life adopts Eurex Clearing’s ISA Direct 26 June 2019Zurich Reporter: Rebecca Delaney
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Swiss Life Asset Managers has become the first buy-side organisation to utilise Eurex Clearing’s ISA Direct service.
The service was used for over-the-counter (OTC) interest rate derivatives, while ABN AMRO acted as clearing agent.
Eurex Clearing developed ISA Direct in response to risk concentration, increased cost of clearing, and increased capital requirements for banks. It uses intermediaries as clearing agents, who assume responsibility for default management compliance.
ISA Direct is initially available on Eurex Clearing’s interest rate swaps and repo transactions, providing them with a lower balance sheet impact.
Jan Grunow, head of operations at Swiss Life, commented: “By being able to directly connect to Eurex Clearing, our concerns about credit risk and the portability of our assets are much better addressed. The ISA Direct model alleviates many of our concerns and helps us to meet the regulatory requirement of central clearing.”
Philip Simons, head of fixed income, funding and financing sales, Eurex Clearing, added: “We welcome Swiss Life on board and thank ABN AMRO Clearing for its continued support. It confirms the value proposition of the ISA Direct model and we look forward to working with market participants to accelerate the adoption of this innovative service.”
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