Goldman Sachs goes live as clearing broker for LCH

The move follows Barclays and Barclays Ireland becoming clearing brokers at CDSClear just last month.

LCH – part of the post-trade division of London Stock Exchange Group – has announced that Goldman Sachs International and Goldman Sachs Bank Europe SE have gone live as clearing brokers at CDSClear at it continues to expand its network.

“By partnering with us, Goldman Sachs is expanding the credit clearing opportunities available to its clients, enabling them to reduce credit portfolio risk and capital, and benefit from margin offsets and operational efficiencies,” said LCH in a statement. 

Europe-based CDSClear allows users to cross-margin European and US products. In 2012 it became an international service following regulatory efforts to enforce the central clearing of certain credit default swaps.

Two years later, the European Securities and Markets Authority reauthorised the CCP to clear the products under the European Market Infrastructure Regulation. 

Richard Pape, managing director, Goldman Sachs International, highlighted that the move will allow its clients to access an increased variety of credit derivatives eligible for clearing.

“We are excited to expand our Derivatives Clearing platform with the addition of LCH Clear,” he said. “As a clearing broker at LCH CDSClear, we can provide our clients with access to the broadest range of credit derivatives eligible for clearing, enabling them to reduce their credit portfolio risk and lower costs through capital reduction, margin offsets and greater operational efficiency.”

LCH has previously stated its intention to continue the expansion process for its clearing network and the range of credit products eligible for clearing.

Frank Soussan, global head of LCH CDSClear, said: “I’m delighted to welcome Goldman Sachs International and Goldman Sachs Bank Europe SE as new clearing brokers at LCH CDSClear. Our collaboration will equip Goldman Sachs’s clients with the tools they require to reduce their risk factors and gain capital potential through clearing.”

Last month, Barclays and Barclays Ireland went live as clearing brokers at CDSClear in a bid to benefit from capital gain opportunities.