LCH.Clearnet, the pan-European central counterparty, has said that it will continue to serve NYSE Euronext's European securities and derivatives markets after November 2012.
On 12 May 2010, transatlantic exchange operator NYSE Euronext announced its intention to stop using the clearing house which services its four equities exchanges in Europe, its dark trading venue SmartPool, and its NYSE Liffe derivatives exchange ahead of building its own two purpose-built clearing houses in Paris and London by 2012.
The new arrangement will extend the cash equities clearing notice period until December 2013 and derivatives clearing notice period until at least June 2013.
Ian Axe, chief Executive at LCH.Clearnet said, “We look forward to continuing to support NYSE Euronext, as we have for many years, and to providing them with our world class service. In parallel, we are working with them on a longer term plan regarding cash equities' clearing arrangements.”
Rather than develop its own clearing houses, NYSE Euronext could potentially use Deutsche Börse's clearing capabilities if the two exchanges' planned merger takes place. The German market operator uses Eurex Clearing, part of the Eurex derivatives exchange, a joint venture with Swiss exchange and infrastructure firm SIX Group, to clear its cash equities business.
As a result of the proposed NYSE Euronext-Deutsche Börse merger, SIX Group announced on 7 June that it would be selling its half of the Eurex business to Deutsche Börse.
Duncan Niederauer, CEO of NYSE Euronext said, “In the current dynamic environment, where we are finalising our planned business combination with Deutsche Börse's and LCH.Clearnet Group is considering its own strategic options, this extension gives both parties the time needed for these strategies to crystallise, while providing operational stability and continued service to our customers in the meantime.”
LCH.Clearnet has recently been the subject of a takeover enquiry by financial information services provider Markit and NYSE Euronext. According to press reports, the firm has appointed J.P. Morgan Cazenove.