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Direct clearing: Frank Odendall about opportunities for buy-side CCPs

10 Oct 2018

Direct clearing: Frank Odendall about opportunities for buy-side CCPs

The introduction of buy-side direct clearing for central counterparties (CCPs) has created buy-side opportunities while raising new considerations about business models, risk and reward. Whether and how to engage, for which products and with which counterparties will be an important point of differentiation for the buy-side going forward.

Frank Odendall, Senior Vice President Global Funding & Finance (GFF) at Deutsche Börse Group, explains the Group’s product-specific approach to buy-side direct clearing. He looks at how individual clients can save 50-70 percent in margin for OTC interest rate swaps and exchange traded derivatives and shows how the Group’s ISA Direct clearing solution for derivatives and repos offers direct access to Eurex Clearing, the Group’s CCP for these products.

Participating directly in a CCP requires buy-side firms to rethink some basic assumptions about their business models and Odendall goes into details about what these assumptions are, which hurdles need to be overcome and how direct clearing can give firms the chance to stand ahead of their peers and have better opportunities to access liquidity and reduce credit risk exposure.

Download the pdf below to read the full article. It was originally published in issue 12 2018 of the Securities Finance Monitor.