CME Group’s plans to extend its ClearPort clearing
service to a wider range of foreign exchange products will go
live early next year.
Derek Sammann, global head of foreign exchange at CME Group,
confirmed in mid-October that: "Our goal is to have internal
readiness for ClearPort by the end of the year – and
we’re well on schedule for that and external
readiness in terms of clients’ technology and
readiness for early in 2010."
Sammann said the general reluctance to take on counterparty
risk was the driver for the venture. "There is now a clear
government mandate for clearing CDS, and although
we’ve not yet reached that point in the global
foreign exchange market, the case for the credit mitigation
facility of a clearing house for the global FX market is now
becoming compelling," he said.
"We’ve seen in the last 12 months an increased
reluctance to take on counterparty risk. And we
don’t see this going away."
CME’s plans to move into clearing OTC forex
products were flagged by Craig Donohue, CME group chief
executive, in late September. He also said its previous effort
to expand into the OTC market – it pulled out of
FXMarketSpace, a joint venture with Thomson Reuters, in October
2008 – had been too "revolutionary" for market
Donohue said that customers did not want clearing and
execution on the same platform, but rather just clearing, and
that that is what ClearPort would provide.
(For full details see FX feature on page 37)
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