CME Group, the world’s leading and most diverse derivatives marketplace, today announced that Chicago Mercantile Exchange Inc. has been granted authorization to provide OTC clearing and settlement services and has been designated as a central counterparty (CCP) by the Securities and Futures Commission (SFC) in Hong Kong.
With this authorization, the clearing house division of CME (CME Clearing) can now provide market participants in Hong Kong clearing and settlement services in its OTC interest rate swaps. In addition, with the designated CCP status, CME is now able to provide a choice to market participants subject to mandatory clearing under Hong Kong law. Market participants may now fulfil their mandatory clearing obligations by clearing their trades through CME Clearing for transactions in certain standardized interest rate swaps that are denominated in Hong Kong dollars or one of the G4 currencies (USD, EUR, GBP and JPY).
“We are pleased to receive authorization to provide clearing services in Hong Kong to help clients here manage their risk,” said Sunil Cutinho, Senior Managing Director, and President of CME Clearing. “We look forward to working with Hong Kong market participants who may now benefit from capital efficiencies for their interest rate swap portfolios, and at the same time meet their mandatory clearing obligations for certain OTC interest rate swaps.”
“CME Group is committed to serving the needs of our clients in the region,” said Christopher Fix, Managing Director, and Head of Asia Pacific, CME Group. “CME’s newly-granted authorization as well as our designated CCP status in Hong Kong complement the various licenses and permissions we have across Asia, as we continue to step up to offer products and services that meet the evolving risk management needs of our clients.”
Over the past few months, CME has received approvals across Asia Pacific, including Foreign Clearing Organization (FCO) status by the Japan Financial Services Agency in June 2016, and Recognized Clearing House (RCH) status by the Monetary Authority of Singapore in May 2016.