Deutsche Bank cleared the Australian Stock Exchange's first over-the-counter interest rate derivative transaction today in a groundbreaking move that reinforces its position as a leading global and local OTC derivative clearer.
The interest rate swap was executed this morning between Deutsche Bank and Commonwealth Bank of Australia, affirmed via Markit Wire and cleared at the ASX within 60 seconds.
Peter Connor, co-head of Markets Prime Finance, Asia Pacific, said: “We have long supported a domestic OTC service as a way to ensure that the Australian OTC markets continue to function in an orderly way. Over the past two years we've worked hard to bring this vital risk-management infrastructure to life in a way that benefits international institutions, local participants and end-users.”
ASX’s OTC Derivatives Clearing Service became available on 1 July 2013. It provides central counterparty clearing for standardised OTC-traded Australian dollar interest rate derivatives, a market with an annual turnover of around $15 trillion, according to the most recent figures for full-year 2012. The availability of the service aligns with Australia’s G20 commitments on central counterparty clearing of interest rate swaps.
Darren Boulos, head of Fixed Income and Currencies, Australia and New Zealand, said: "The availability of a domestic OTC clearing venue puts Deutsche Bank in a strong position to maintain its leading role in the local interest rates market, given that the European Securities and Markets Authority recently agreed to recognise the equivalence of Australia’s regulatory regime."
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