First clearing house in Europe to be authorised as EMIR compliant
NASDAQ OMX Clearing, the multi-asset clearing house based in Stockholm, today announced that the Swedish FSA (SFSA) has approved its application as a central counterparty under the European Market Infrastructure Regulation (EMIR). The decision by the SFSA followed an opinion on March 12th by a college of regulators and central banks from Denmark, Finland, Norway, Sweden, and the UK, as well as the European Central Bank (ECB) and the European Securities and Markets Authority (ESMA).
The decision by SFSA makes NASDAQ OMX Clearing the first clearing house in Europe to be authorised as EMIR compliant. For banks and broker firms using NASDAQ OMX Clearing, the EMIR authorisation confirms that the risk models, systems and operations are resilient and robust and have the ability to handle increased demand during periods of market stress. NASDAQ OMX Clearing was also the first clearing house to have a solution that provides protection to client assets in the case of a default of a clearing member. This best-in-class model for segregating and protecting customer assets has now been reviewed and considered EMIR compliant and the members of NASDAQ OMX Clearing can offer this to their customers.
“This approval highlights our leading position in the clearing space,” says Hans-Ole Jochumsen, Executive Vice President, Transaction Services Nordic, NASDAQ OMX. “Our clearing house was the first with true multi-asset derivatives clearing in Europe. Now, as the first to be EMIR authorised, we can focus on further developing our offering, including an expansion within interest rate swaps and German power derivatives, as well as introducing clearing of foreign exchange products.”
NASDAQ OMX Clearing offers a full range of clearing services in equity derivatives, interest rate derivatives and commodity derivatives. It is the fourth largest derivatives clearing house in Europe and the second largest in the clearing of OTC interest rate swaps.
The integrated multi-asset risk management and clearing platform provided by NASDAQ OMX Clearing enables leading capital efficiencies through cross margining between exchange traded and OTC traded contracts and a net margin figure across asset classes. NASDAQ OMX Clearing is the first clearing house to be authorised as EMIR compliant and determined as a qualifying CCP (QCCP) under Basel III/CRR IV. The QCCP status means that financial firms dealing with the clearing house are subject to significantly lower capital requirements compared to a non-QCCP.
EMIR is the EU regulation that, similar to Dodd Frank in the U.S., followed the decision by the political leaders of G20 in 2009 to mandate central counterparty clearing of OTC derivatives in order to mitigate the systemic risk in the financial markets and increase stability.