ICE Clear Credit, a division of IntercontinentalExchange (ICE: Quote) Tuesday said it has received regulatory approval for providing portfolio margining relief for buy-side clearing of CDS.
“Putting portfolio margining in place for client accounts is an important step toward realizing one of the key aims of Dodd-Frank, to encourage increased clearing of swaps, ” said ICE Clear Credit President Christopher Edmonds.
Portfolio margining allows clients to achieve capital efficiencies by clearing index and single name CDS in a single CFTC customer account, thereby eliminating a key economic barrier to buy-side clearing by recognizing margin efficiencies within hedged portfolios.Portfolio margining for buy-side accounts also reduces systemic risk, significantly improves the capital efficiency of clearing and provides a proven and well understood regulatory regime for clearing index and single name credit default swaps.
ICE Clear Credit’s petition to provide portfolio margining had overwhelming support from both buy-side and sell-side participants.
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by RTT Staff Writer
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