Refinitiv FXall is expanding FX traders’ access to cleared workflows for FX OTC trades by building connectivity to LCH. This new solution will provide FXall users a streamlined and quicker way of clearing NDF trades through LCH’s ForexClear service. The solution is expected to go live in the final quarter of 2021 subject to regulatory approval.
With the implementation of Phase 5 of the Uncleared Margin Rules (UMR) in September 2021, buy-side institutions are assessing how they will be affected and weighing the benefits of FX clearing. Institutions are evaluating the costs and operational challenges associated with these new margin requirements for uncleared trades and may instead elect to clear portions of their FX flow.
Institutional traders on FXall will be able to determine which of their trades get cleared, for example based on the liquidity provider, currency pair, or account they are trading for. Trades will be routed to LCH via Settlement Center, FXall’s post-trade processing platform. In subsequent releases, FXall will support cleared workflows for additional instrument types and Refinitiv venues, as well as with additional clearing houses.
Jill Sigelbaum, Head of FXall, said:
“Both FXall and LCH share a commitment to the principle of open access and giving market participants a range of options for clearing and trading. This initiative brings together the services of two well-established brands that deliver on that commitment, while empowering institutions minimize counterparty credit risk and achieve capital efficiency opportunities.”
James Pearson, Head of ForexClear, LCH, said:
“We’re delighted to be working with FXall to connect with LCH. This initiative will expand the choice of trading venues available to buy-side firms that wish to access the risk management and efficiency benefits of clearing. The uncleared margin rules have sharpened the industry’s focus on initial margin and enhanced standards, and we look forward to working with FXall and the broader market to ensure widespread access to clearing.”
FXall offers clients access to deep liquidity with choice in execution, end-to-end workflow, and straight-through processing covering the entire trade lifecycle. FXall has a client base of over 2,300 clients and 230 bank and non-bank liquidity providers.
