Equities traders in the Nordic region can now benefit from the protection of central counterparty (CCP) clearing with today’s launch of services for exchange group Nasdaq OMX’s
three regional bourses and pan-Nordic multilateral trading facility Burgundy.
Both clearing services are mandatory and are operated by pan-European post-trade provider European Multilateral Clearing Facility (EMCF) which is 22%-owned by Nasdaq OMX. The launches mark a fundamental change in the structure of the Nordic equities market, as the region previously lacked a CCP and relied on bilateral clearing.
Nasdaq OMX’s mandatory CCP service for the Copenhagen, Helsinki and Stockholm will initially be available today for nine securities: three Danish, three Finnish and three Swedish.
While the launch provider for Nasdaq OMX’s service is EMCF, it will shortly be joined in January next year by fellow pan-European clearer EuroCCP and Swiss post-trade provider SIX x-clear, which have all agreed to interoperate and offer competitive clearing by January 2010.
“The Nordic equity markets have taken a quantum leap from bilateral clearing to central counterparty clearing in record time,” said Hans-Ole Jochumsen, president of Nasdaq OMX Nordic, in a statement. “In a world first, we have accomplished this on three markets simultaneously. This is the biggest structural change for the Nordic equity markets since trading became electronic in the early 1990s, and I expect the introduction of CCP to have a similar increasing effect on volumes.”
Burgundy’s CCP service covers Nordic blue-chip equities. ”Finally the Nordic countries will be on the European level with regards to trading and settlement cost competitiveness,” said Olof Neiglick, CEO of Burgundy.