08 August 2017
Paris
Reporter: Jenna Lomax

LCH and Euronext secures 10-year deal on derivatives clearing


Euronext will sign a derivatives clearing agreement with LCH Group’s French arm in Q4 to to ensure a continuity of clearing services after Brexit and once the second Markets in Financial Instruments Directive II (MiFID II) is finalised.

The deal allows for clearing services for listed financial and commodity derivatives for the next 10 years between the two companies.

According to LCH, the new agreement will improve value proposition for customers and reduce clearing fees, while also providing continuity of service and economic returns for LCH SA.

LCH SA and Euronext also committed to reducing clearing fees by between 5 percent and 15 percent from January 2019, depending on each specific product and service.

The European stock exchange currently has a 2.3 percent stake in the LCH Group. The exchange will swap this in Q4 for an 11.1 percent minority stake in LCH SA “to allow Euronext to align its shareholdings with its commercial interests in the clearinghouse”.

Suneel Bakhshi, CEO of LCH Group, said: “Announcing this agreement is a significant achievement for the LCH Group and highlights the spirit of strong partnership with Euronext.”

“We are delighted to be able to offer continuity of services for clearing members and clients while also delivering best in class service and robust risk management across a range of cash and derivatives markets, in line with our open access principles.”

Christophe Hemon, CEO of LCH SA, added: “We are delighted to have reached agreement to continue providing clearing services to Euronext and its customers. Euronext’s transfer of its shareholding in LCH Group to LCH SA will also further deepen our long-standing relationship.”

More news
The latest news from Securities Lending Times
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
J.P. Morgan and Citi collaborate on truePTS post-trade platform
15 December 2017 | New York | Reporter: Zsuzsa Szabo
The New-York-based startup processes ecosystem for the global $700 trillion derivatives market
SIFMA: US market requires improved CCP access
15 December 2017 | Washington DC | Reporter: Jenna Lomax
The Dodd-Frank Act has increased the need for US firms to have access to non US swaps trading venues and central counterparties, according to paper by FIA and SIFMA
France raises spectre of European financial transactions tax
15 December 2017 | Paris | Reporter: Jenna Lomax
French President Emmanuel Macron and several ministers have dismissed concerns over the negative effect of an EU financial transactions tax on securities lending revenue
Vekaria exits Credit Suisse
14 December 2017 | Dublin | Reporter: Zsuzsa Szabo
Head of Credit Suisse's Dublin branch Manish Vekaria has left the bank
Cerberus hires new managing director
14 December 2017 | New York | Reporter: Jenna Lomax
Kimmel was previously global head of prime services at Cantor Fitzgerald
SMEs to face new research costs under MIFID II
14 December 2017 | Frankfurt | Reporter: Zsuzsa Szabo
Research services for SMEs will no longer be free of charge when MiFID II comes into force on 3 January 2018
Hedge funds in sprint finish for record-breaking returns in 2017
14 December 2017 | London | Reporter: Drew Nicol
Hedge funds are on track for their best annual revenue since 2013 with average returns of 7.7 percent, according to eVestment research