TriOptima announces today that 18 financial institutions reduced notional principal outstanding by 404 trillion JPY ($3.36 trillion USD) in the first triReduce compression cycle for unlinked, cleared JPY interest rate swaps in LCH.Clearnet’s SwapClear. This represents a 300% increase in notional principal eliminated, compared to previous JPY cycles in LCH.Clearnet SwapClear.
Where clearing houses maintain their trades as “unlinked trades”, having unlinked them from the original counterparty, a larger pool of trades becomes available for compression since dependence on the participation of other clearing members is reduced.
“Interest in compression has significantly increased in Asia and we are working together with the industry to further improve compression efficiency.” said Yutaka Imanishi, CEO of Asia Pacific. “We believe there is strong potential for eliminating line items and notional principal.”
