The Commodity Futures Trading Commission (CFTC) is considering a request from ICE Clear Europe to allow non-clearing members to benefit from cross-border margin offsets.
A petition filed by ICE builds on an existing order allowing its European central counterparty (CCP) to offer portfolio margining to its clearing members.
In response, the US regulator is now seeking public input on whether this permission can be stretched to futures commission merchants (FCMs) that are not clearing members themselves.
The decision would allow FCMs to benefit from margin offsets on interest rate, equity and index derivatives traded across ICE’s CCPs on both side of the Atlantic.
Through the acquisition of NYSE Euronext last year, all interest rate and equity derivatives traded on the London-based Liffe platform are now cleared through ICE Clear Europe, while Liffe US contracts were also transitioned to ICE Futures US.
The additional contracts being cleared throughout ICE have opened up its ability to offer more cross-margin offsets throughout its clearing house.
CCPs across Europe are increasingly making moves to offer margining efficiencies in light of new competition rules set to take hold in the continent.
Reponses to this month’s TRADE Poll show that changing clearing arrangements stemming from regulatory changes are increasingly attracting buy-side participants to Europe’s derivatives market.
To vote on The TRADE Poll click HERE.