Eurex Clearing gets Emir approval

Eurex Clearing gets Emir approval

Eurex Clearing is the fourth central counterparty (CCP) to receive approval under the European Market Infrastructure Regulation (Emir).
The German regulator BaFin issued the approval on April 10.

Eurex Clearing follows the recent licenses given to the Polish clearinghouse KDPW_CCP, Nasdaq OMX Clearing and the European Central Counterparty.

“Our Emir authorisation is an important milestone and confirms full compliance of our clearing services with the Emir rules,” said Thomas Book, CEO of Eurex Clearing.

“We are very happy that at this stage Eurex Clearing can provide its clients and members with the clarity and reassurance needed to undertake their readiness planning and onboarding preparation for the looming clearing mandate in Europe.”

The CCP applied for Emir authorisation in August last year.

The announcement follows the publication of a study by Eurex Clearing on the capital efficiencies of central clearing.

New regulations such as Basel III, Capital Requirements Directive IV (CRD IV) and Emir raise capital and collateral requirements for derivatives and securities finance transactions.

The paper, commissioned to Oliver Wyman, found that market participants on both the sell and buy sides could lower their capital and funding costs by pooling clearing on an integrated cross-product CCP.

One of the study's main findings  was that the use of an integrated cross-product CCP structure could save the European sell- and buy-sides by up to €4-5bn ($5.6bn-$7bn) in incremental costs for interest-rate derivatives, repo and securities lending. This figure would be in addition to the €5bn-7bn estimated costs of centrally clearing through a baseline CCP.