More than 600,000 trades have been submitted to clearinghouses by MarkitSERV in the period between 11 March, when the Commodity Futures Trading Commission made clearing of certain over-the-counter (OTC) derivatives mandatory, and the end of July.
MarkitSERV is the most widely-used trade processing service for OTC derivatives.
In the first half of 2013, the volume of trades submitted for clearing using MarkitSERV was up 48 per cent from the same period in 2012, and included more than 120,000 “client” trades – transactions in which at least one party is not a member of a clearinghouse – on behalf of approximately 280 firms.
More than 300 buy-side firms became new subscribers of MarkitSERV’s clearing connectivity so far this year in order to comply with CFTC mandates and to gain an efficient solution for clearing derivatives in multiple asset classes at multiple clearinghouses.
Henry Hunter, managing director and head of product management for MarkitSERV, says: “The CFTC’s Category 2 deadline affected a large number of firms and the industry has accomplished a lot in a short time. Firms need a seamless trade management process for the front, middle and back office, so they can meet obligations to clear trades moments after they execute. MarkitSERV gives customers a practical cross-asset class solution that helps them process, clear and report OTC derivative transactions.”
MarkitSERV connected to its first clearinghouse in 2004, and since then, more than five million OTC derivatives trades have been submitted for clearing using MarkitSERV. Today, the service links more than 2,500 buy-side firms, 100 dealers and 70 execution venues to 13 clearinghouses worldwide. MarkitSERV’s newest clearing connection is to LCH.Clearnet LLC (SwapClear US), which launched in June.
The CFTC-registered derivatives clearing organisations (DCO) that MarkitSERV connects to are CME, ICE Clear Credit, ICE Clear Europe, LCH.Clearnet LLC (SwapClear US), LCH.Clearnet Ltd (SwapClear UK), and Options Clearing Corp (OCC). MarkitSERV is also connected to Eurex Clearing AG and LCH.Clearnet SA (CDSClear), each of which has DCO registrations pending with the CFTC.