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Screenshot of a breaking news alert e-mail from Q2 2017
CLS Group (CLS), a provider of risk mitigation and operational services for the global foreign exchange market infrastructure, and TriOptima, a provider of OTC derivatives post-trade and risk reduction services, announce today the launch of the triReduce CLS Forward FX Compression Service completing the first successful compression cycle for FX forwards and swaps transactions.
The new service leverages CLS’s infrastructure and market connectivity and TriOptima’s triReduce compression product to empower counterparties to cut the gross notionals of their outstanding portfolios without markedly changing their market positions.
Released at a time when international regulators are encouraging the use of compression services for non-centrally cleared OTC derivatives, the triReduce CLS Forward FX Compression Service aims to limit operational, credit and counterparty risk for institutions and enhance capital efficiency. It is consistent with the goals of EMIR, Basel III and Dodd-Frank, all of which seek a more robust and transparent post-trade environment.
David Puth, CEO of CLS, comments:
“Trade compression is a vital tool in managing risk, leading to strong market demand for a compression service for FX forwards and swaps. By combining CLS’s infrastructure, network and expertise in the FX market with TriOptima’s knowledge of the OTC derivatives environment and experience with compression in other asset classes, this new service enables institutions to efficiently reduce counterparty and credit exposure and to meet global regulatory requirements.”
Peter Weibel, CEO of triReduce, TriOptima’s compression service, comments:
“Working with CLS and its members underscores our commitment to providing robust and efficient compression services to a broad range of financial market participants. Adding FX forward compression is an important expansion of the asset classes in our catalogue of compression services.”
Plans for the launch of the service were unveiled early this year. Check out LeapRate’s report on the topic.