The figure, reached in the first 10 days of SEF trading since 2 October, includes trade routing to central counterparties for the eight swaps venues using MarkitSERV for this function.
The US$1 trillion figure also includes trades that are reported to the Depository Trust and Clearing Corporation’s DDR Swap Data Repository, as required under the Dodd-Frank Act.
In a statement, MarkitSERV said SEF activity was largely concentrated in interest rate swaps (IRS). The firm, a joint venture between financial information services firm Markit and the DTCC, offers SEF-related services including real-time trade messaging, trade reporting and routing trades to clearing houses.
“MarkitSERV has worked with industry participants and SEFs to deliver an integrated and flexible workflow which meets everyone’s needs as new regulatory requirements come into force,” Henry Hunter, global head of derivatives processing for Markit, said.
Trading on SEFs is expected to increase as rules from regulator the Commodity Futures Trading Commission come into force that mandate swaps trading on SEFs, expected before the end of 2013.
Another rule, expected in December, requires participants to trade an instrument on a SEF if a platform offers trading in that product, known as the ‘made available to trade’ rule – is also expected to increase the transition away from bilateral swaps trading.