The Depository Trust & Clearing Corporation plans to establish a subsidiary called DTCC Derivatives Repository, which will maintain global credit default swap data identical to that maintained in its New York based Trade Information Warehouse.
The move is intended to help ensure that regulators globally have secure and unfettered access to global data on credit default swaps by establishing identical CDS data sets on two different continents.
“DTCC has always envisaged a ‘global solution’ for repository services supporting each OTC asset class,” says Stewart Macbeth, managing director and general manager, Trade Information Warehouse. “It is very common for counterparties to be located on different continents and to trade on underlying securities issued across borders. This means that repositories for any asset class need to maintain global information to be useful. It also means that steps need to be taken to ensure that the data is always available to regulators globally regardless of events and circumstances taking place in one location or another.”
DTCC Derivatives Repository will be headquartered in London under a regulatory application filed with the Financial Services Authority in the UK.
The new subsidiary will jointly house the global equity derivatives repository being built by DTCC as the result of winning the International Swaps and Derivatives Association global bid for this service. The location of the European subsidiary was made based on the ISDA mandate to have the global equity derivatives repository in London.
The European-based repository will support a wide variety of functions, including operational, customer, technical and, most importantly, CDS trade reporting.
DTCC’s current customer base in the credit derivatives market includes all major derivatives dealers and more than 1,700 buy-side firms and other market participants located in more than 50 countries and supporting reference entities in 90 countries.
