NEW YORK & LONDON--(BUSINESS WIRE)-- TriOptima today announced that it has resumed triReduce compression cycles within LCH.Clearnet’s SwapClear service, eliminating $16 trillion in notional principal with one EUR and one USD interest rate swap cycle in the last month of 2013. This brings the cumulative total of notional compressed by TriOptima and SwapClear to $204 trillion.
With the resumption of triReduce multilateral compression in December, 33 SwapClear clearing members reduced their gross notional outstandings by almost $43 trillion in 2013. Lower gross notional exposure contributes to bringing an institution’s leverage ratio in line with regulatory expectations, an important goal for banks. Trade compression cycles also help ensure post-trade efficiency; and running regular cycles in a range of currencies reduces both the gross notional and the number of outstanding OTC derivative transactions in the Clearing House.
“We are pleased that we have resumed the triReduce service for SwapClear clearing members,” said Peter Weibel, triReduce CEO. “We know there is strong interest from customers to eliminate as much gross notional exposure as possible in the Clearing House, and we have collaborated with LCH.Clearnet’s SwapClear service and its clearing members to develop an ambitious compression schedule for 2014.”
“Our clearing members are under increasing pressure to reduce notional outstanding due to the emerging capital rules on derivatives, and the re-introduction of the triReduce compression service within SwapClear is therefore a key component of our offering”, said Daniel Maguire, head of LCH.Clearnet SwapClear US.
Since the launch of triReduce in 2003, OTC derivative market participants have eliminated more than $375 trillion in notional principal outstanding using the service. triReduce cycles include cleared interest rate swaps and uncleared interest rate swaps in 27 currencies, credit default index and single name swaps and commodity swaps.
TriOptima is the award-winning provider of post trade risk management services and infrastructure for OTC derivatives. Focused on reducing costs, eliminating operational and credit risk, improving counterparty exposure management, and reducing systemic risk, TriOptima offers a range of services: triReduce to reduce swap inventory and counterparty risk; triResolve to reconcile OTC derivative portfolios and manage disputes; and triBalance to manage cleared and bilateral counterparty risk.
TriOptima, an ICAP Group company, maintains offices in London, New York, Singapore, Stockholm, and Tokyo.