New Hong Kong CCP clears first OTC derivatives trade
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New Hong Kong CCP clears first OTC derivatives trade 04 December 2013Hong Kong Reporter: Georgina Lavers
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OTC Clearing Hong Kong, a subsidiary of Hong Kong Exchanges and Clearing Limited (HKEx), cleared its first OTC derivatives transaction using Calypso’s CCP OTC clearing solution when it began business on 25th November 2013.
OTC Clear, whose 12 founding shareholders include five mainland Chinese banks, selected Calypso as the system to provide end-to-end OTC clearing, processing and risk management of interest rate swaps and FX non-deliverable currency forwards.
OTC Clear is also the first clearing house to employ Calypso’s collateral management module to handle and process collateral with its clearing members.
“The success of the recent go-live, where the first trade cleared was a non-deliverable Renminbi 7-day repo swap, highlights the evolving market structure of Hong Kong as a key financial centre and will further leverage Hong Kong’s position as the premier offshore Renminbi centre,” said a statement from Calypso.
“In looking for a partner, we wanted a provider who had deep experience in implementing OTC clearing technology and who fully understood our business and our position as a financial hub for the Renminbi-denominated products in the OTC marketplace,” said Gerald Greiner, global head of clearing at HKEx.
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