CME Group anticipates launching a buy-side clearing membership next year that allows direct cash collateral deposits, pending regulatory approval. The membership is not meant to disintermediate futures commission merchants from clearing, CME says.
LCH.Clearnet and CME Group will compete for buy-side business in the repurchase market with Eurex Clearing and Depository Trust & Clearing Corp. LCH is reviewing various buy-side clearing models for repo in order to provide clearing to buy-side cash lenders, and LCH or CME may well provide cross-margining for swaps, repos and futures all under one risk-management shield.
At ISDA's Annual General Meeting in Singapore, market participants voiced concern that many buy-side firms will not meet Wednesday's deadline for signing up to a business-conduct protocol and therefore could lose their ability to trade over-the-counter derivatives. About 7,500 counterparties have agreed to business-conduct standards from the Commodity Futures Trading Commission, says Katherine Darras, ISDA's general counsel for the Americas.
Woodbine Associates has assembled a checklist for buy-side market participants to see whether they're ready for rules on over-the-counter derivatives clearing that are set to take effect March 13. Clearing, execution venues and pretrade analysis are among topics mentioned in the 50-page report.