Clear cut

19 June 2009 By Mike Prest

EuroCCP is calling on its European clearing and settlement competitors to agree a common operating convention. The idea isn t selfless the USowned mutual wants more business. But it could reduce risk and increase competition. That should mean cheaper securities dealing.

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On June 16, European Central Counterparty, a clearing and settlement company, called on all other European central counterparties to sign a standard convention on interoperability – how they managed their exposure to each other.

EuroCCP is a subsidiary of the Depository Trust and Clearing Corporation, a US company which has a monopoly of equities clearing in the US and is owned by its members.

Under the proposed convention, central counterparties would agree on risk management arrangements which are transparent to market users, trading platforms and regulators.

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