LCH SA connects to Cboe Europe for equities clearing
06 October 2020 London
Image: alphaspirit / Adobestock.com
LCH’s EquityClear service is now providing clearing services for Cboe Europe, one of the largest pan-European equities exchanges by value-trading.
Market participants trading Euronext securities via Cboe Europe’s UK order books, BXE and CXE, are now able to select LCH as their clearinghouse under the preferred central counterparty (CCP) model.
The ‘preferred CCP’ model enables Cboe Europe participants to clear through LCH provided that both counterparties to the trade have elected it as their preferred CCP for Euronext securities.
According to LCH, this will allow members to consolidate their clearing activity for those securities through one clearing house and benefit from increased netting, lower settlement costs and greater operational and margin efficiencies.
Christophe Hémon, CEO at LCH SA, comments: “This is the latest milestone in our strategy to expand the number of equities trading venues available to our clearing members.”
David Howson, president at Cboe Europe, adds: “We’re pleased to be working with LCH to widen the choice of clearing venues available to our customers.
“This demonstrates our commitment to open access and competitive clearing in European equities, and we look forward to continuing our collaboration to provide this important post-trade service to our customers.”
News of the partnership follows confirmation that LCH’s UK entity will be one of three clearinghouses to be recognised by the EU as third-country CCP from January 2021, following the conclusion of Brexit.
The three UK CCPs will be eligible to provide services in the EU after the end of the transition period following the withdrawal of the UK from the EU on 31 December 2020.
Market participants trading Euronext securities via Cboe Europe’s UK order books, BXE and CXE, are now able to select LCH as their clearinghouse under the preferred central counterparty (CCP) model.
The ‘preferred CCP’ model enables Cboe Europe participants to clear through LCH provided that both counterparties to the trade have elected it as their preferred CCP for Euronext securities.
According to LCH, this will allow members to consolidate their clearing activity for those securities through one clearing house and benefit from increased netting, lower settlement costs and greater operational and margin efficiencies.
Christophe Hémon, CEO at LCH SA, comments: “This is the latest milestone in our strategy to expand the number of equities trading venues available to our clearing members.”
David Howson, president at Cboe Europe, adds: “We’re pleased to be working with LCH to widen the choice of clearing venues available to our customers.
“This demonstrates our commitment to open access and competitive clearing in European equities, and we look forward to continuing our collaboration to provide this important post-trade service to our customers.”
News of the partnership follows confirmation that LCH’s UK entity will be one of three clearinghouses to be recognised by the EU as third-country CCP from January 2021, following the conclusion of Brexit.
The three UK CCPs will be eligible to provide services in the EU after the end of the transition period following the withdrawal of the UK from the EU on 31 December 2020.
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