Traiana Expands FX Clearing

Terry Flanagan

Traiana, a provider of post-trade solutions, has launched direct connectivity between its Harmony CCP Connect and LCH.Clearnet Ltd’s foreign exchange clearing service, ForexClear, for non-deliverable forwards (NDFs) clearing.

Market participants looking to clear foreign exchange trades under the new Dodd-
Frank and Emir regulations can leverage existing foreign exchange prime broker connectivity together with Harmony CCP Connect’s matching and affirmation capabilities to get direct access to CCPs.

“One of our main objectives is to enable our members and their clients to achieve regulatory compliance,” said Gavin Wells, CEO of LCH.Clearnet’s ForexClear, in a statement. “By working with Traiana, as the leading foreign exchange clearing service, we are facilitating access to our risk management expertise while reducing some of the complexities associated with trade processing.”

Launched in 2012, ForexClear provides clearing for NDFs with clearing between direct clearing members.

NDFs are cash settled products, actively traded in a range of high growth economy currencies.

LCH.Clearnet has cleared more than $500 billion in notional of FX NDFs through its ForexClear service since launch, the company announced earlier this year. The success of ForexClear has been fueled by increased demand for robust clearing solutions as leading FX market participants seek to manage their counterparty risk exposures.

The service was designed in close collaboration with leading FX market participants and global regulators to address regulatory developments. LCH.Clearnet is reporting cleared FX trades to a swap data repository (SDR) run by the Depository Trust and Clearing Corporation (DTCC).

The move is in line with the Commodity Futures Trading Commission’s (CFTC) regulation to mandate the reporting and recordkeeping of all FX trades, except spot, through a registered SDR.

ForexClear facilitates market transparency by submitting all data throughout the life of a cleared FX trade to the SDR within seconds of novation.

Traiana’s Harmony CCP Connect provides a workflow via the Harmony network for both interdealer and client clearing, including CCP connectivity, trade routing, affirmation, matching, allocation, and reporting for OTC foreign exchange options and NDFs.

Harmony CCP Connect now provides direct access to all CCPs, reducing lead times and complexity for market participants.

“LCH.Clearnet is a key partner for Traiana and our customers,” said Andrew Coyne, CEO of Traiana. “This complete end-to-end-connectivity solution will reduce the implementation times for participants to connect to ForexClear.”

Harmony CCP Connect also provides a gateway to other leading foreign exchange infrastructure operators, ensuring participants can use their preferred trading, allocation and confirmation venues with complete interoperability.

The platform supports all proposed U.S. and European clearing rules and workflows, simplifying compliance for foreign exchange clearing firms and their clients. Harmony CCP Connect works in conjunction with Harmony CreditLink, Traiana’s central risk management infrastructure for swaps clearing.

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