LCH.Clearnet consolidates market leading position with 85% of cleared European government bond repo market
The nominal value of fixed income trades cleared by LCH.Clearnet reached a record €31 trillion in Q1 2010, driven by record figures of €12 trillion for March 2010. This is a year on year increase for the first quarter of 28% and the first time that LCH.Clearnet, which clears an estimated 85%* of the cleared European government bond repo market, has cleared trades with a value of more than €30 trillion in a quarter.
LCH.Clearnet’s fixed income service has become a key vehicle for secured interbank lending and borrowing as banks increasingly seek to minimise their counterparty risk exposures. This trend has resulted in a significant increase in the proportion of inter-bank repo trades which are cleared.
For over a decade, LCH.Clearnet has worked closely with its members to develop innovative clearing solutions for the fixed income markets, generating significant efficiencies in the management of collateral in the euro and sterling repo markets.
John Burke, director of fixed income, said: “The continued growth in fixed income volumes highlights the more cautious approach to risk management prevalent in the markets. The recent crisis has highlighted the critical role clearing plays in ensuring that interbank liquidity is maintained, even in highly volatile markets.”
LCH.Clearnet is the second largest clearer of bonds and repos in the world, providing services across 10 government markets. It has been clearing OTC fixed income trades for over 10 years.
