Nasdaq Clearing cuts buy-side fees

Nasdaq Clearing has reduced its Nordic buy-side clearing and collateral fees.

Nasdaq Clearing has significantly reduced its buy-side clearing and collateral fees in the Nordic region in a bid to remain competitive in a cost-sensitive client space.

The central counterparty (CCP) said it will reduce its base fee for clearing interest rate swaps from SEK 4.00 to SEK 3.00, reduce maintenance fees from SEK 1.00 to SEK 0.50, and safekeeping fees on pledged securities to zero, down from three-10 basis points.

Speaking to The TRADE Derivatives on the plans Frederik Ekstrom, president of Nasdaq Clearing, says the decision was largely influenced by the buy-side becoming more cost-sensitive to central clearing.

“If the cost [of clearing] is too high it is a risk that it will disincentivise clearing, so for us it was important to lower fees,” said Ekstrom.

“We are starting to see flows coming in, and having implemented the cross-margining and compression services, it is natural that we adjust the fee level and take them down.”

Nasdaq Clearing, which was the first CCP to be approved under the EMIR derivatives clearing mandate, currently competes with the likes of LCH and CME Clearing in Norwegian Krone and Swedish Krona-denominated interest rate swaps clearing.

With the cost of clearing increasingly influencing decision making among asset managers, Ekstrom says the fee reduction is a key part in its plans to remain competitive.

 “This fee reduction is focused only on making our swaps clearing service competitive,” he added.