DekaBank Switches Swap Book To Eurex Clearing
DekaBank, the Wertpapierhaus (securities services provider) of the German Savings Banks Finance Group, has successfully transferred a substantial portion of its swap book from London Clearing House LCH to Frankfurt-based Eurex Clearing in a single day. The complex transaction involving thousands of line items and a dealer bank as transfer agent was carried out without any disruption or market impact.
.@DekaBank has successfully transferred a substantial portion of its swap book from #London to #Frankfurt-based #EurexClearing in a single day. The complex transaction was carried out without any disruption or market impact. https://t.co/ULOPRyNkQL pic.twitter.com/9KPLpqdRhb
— Eurex (@EurexGroup) November 8, 2019
DekaBank has been an early supporter of Eurex Clearing’s initiative to develop a liquid alternative for interest rate derivative clearing within the EU27. To further support clients in migrating positions from London to Frankfurt, Eurex Clearing recently announced a 100 percent discount on booking fees for portfolio switches until end of 2019.
Dmitrij Senko, Member of the Executive Board and Eurex’s Chief Risk Officer: “We are delighted that the switch, with over 7000 individual transactions, went flawlessly in just one day. Demand from EU27 firms considering switching their portfolios is growing, with a number of transfer agents being ready to support these switches.”
Strong rise in European equity derivative volumes
Eurex – Europe’s largest derivatives exchange and part of Deutsche Börse Group – experienced a strong rise in European equity derivative volumes, and several records were broken for commodity ETFs and TRF.
While overall volumes were down, October saw a very strong increase in equity derivatives, largely driven by Single Stock Futures which saw a 121 percent rise – from 10.8 million to 24.0 million traded contracts – compared to the same month in 2018. The monthly record for commodity ETF derivatives was broken with a little over 2 million traded contracts in iShares Physical Gold Options (IGLN). Euro STOXX 50® Index Total Return Futures (TESX) also broke a monthly record with over 450,000 traded contracts.
In the OTC clearing space, notional outstanding volumes for IRD rose by 27% (9,797 billion to 12,464 billion), while overall notional cleared volumes jumped 88 percent to 2,780 billion from 1,476 billion in October 2018, translating to ADVs of 121 and 64 billion respectively. Of special interest was the OTC IRS volume increase in October 2019, where notional outstanding rose by nearly 80% compared to October 2018 (2,709 billion to 4,856 billion), with an ADV increase of almost 100% (9 billion to 17 billion).
EEX, the European Energy Exchange based in Leipzig, increased its year-on-year volumes in the power derivatives market by 5 percent to 356 TWh (339.3 TWh in October 2018). UK power futures saw a new monthly record, more than doubling to 296,110 MWh from 125,070 MWh in October 2018. And double-digit growth was achieved in power futures for Central/South-Eastern Europe (+55 percent), Spain (+38 percent), and Germany (+16 percent).
At Eurex Repo, the leading international financing provider for the secured money market business, average outstanding volume in the GC Pooling Market rose by 42.1 percent in October compared to the same month in 2018 (from 33.7 billion to 47.9 billion).
Phase 5 of the uncleared margin rules (UMR) took effect from September 2021.
Temporary equivalence is set to expire on June 30 2022.
IRS trading volumes have fragmented without an equivalence agreement.
Phase 5 of the uncleared margin rules came into effect on 1 September.
Triparty repos can be executed across U.S. Treasury securities to central clearing.