Burgundy, a multilateral trading facility specialising in Nordic stocks, has chosen Swiss clearing house SIX x-clear as its second provider of central counterparty (CCP) clearing.
SIX x-clear will join pan-European clearing house European Multilateral Clearing Facility (EMCF), which has cleared trades on Burgundy since the platform launched its CCP service on 9 October. Burgundy expects to add SIX x-clear to the service in the second quarter of 2010, pending final agreement between the relevant parties and approval of interoperability agreements by the relevant European regulators.
“The ability to offer another clearing house to the trading participants will further improve our competitive offer,” said Olof Neiglick, CEO of Burgundy, in a statement.
Marco Strimer, CEO of SIX x-clear, added, “This latest partnership with Burgundy is an important development for SIX x-clear as we increase our footprint in the Scandinavian markets. We remain steadfast proponents of an open and transparent CCP framework as we have seen the benefits for the end user first-hand.”
SIX x-clear and EMCF first announced their intention to interoperate in February this year. As a result, a number of EMCF’s client platforms, including Chi-X Europe and Quote MTF, have chosen SIX x-clear as an additional CCP.
SIX x-clear has also struck a deal to clear for Nasdaq OMX’s exchanges in Denmark Finland and Sweden from January 2010. These exchanges currently use EMCF.
In August SIX x-clear announced it would be establishing a representative office in Stockholm, headed by Ann Flodström, to support its Scandinavian business.
As well as being the CCP for SIX Swiss Exchange, a fellow member of the SIX Group, SIX x-clear also clears for several trading platforms and exchanges including the London Stock Exchange, NYFIX Euro Millennium, Equiduct and Liquidnet. It also plans to clear for Nasdaq OMX Europe, which currently clears through EMCF, and Turquoise, NYSE Arca Europe and SmartPool, which all clear through EuroCCP, from January 2010. SIX x-clear and EuroCCP announced their intention to interoperate in May.
CCP interoperability hit a snag in October, when LCH.Clearnet Ltd announced that regulators were reviewing the interoperability agreements signed between it and other CCPs, in part due to concerns about inter-CCP margin requirements.
LCH issued an update on 2 November saying it had received notification from the UK’s Financial Services Authority (FSA) that the regulator was working closely with the Swiss and Dutch authorities to review the interoperability agreements, and that the FSA expected to complete its review in three months.