Derivs - Interest Rate

The Korea Exchange has begun voluntary clearing of over-the-counter Korean won-denominated interest rate swaps, prior to the mandatory clearing start date of July.

LCH Clearnet has tapped Daniel Maguire as global head of SwapClear, LCH Clearnet’s global interest rate swap clearing platform. He replaces Michael Davie, who was promoted to ceo of LCH Clearnet Ltd. Maguire will sit on LCH Clearnet’s executive committee.

State Street plans to add a futures voice and electronic execution service to its State Street Global Exchange platform.

Credit Suisse and BlueBay Asset Management have cleared the first Euro overnight index swap trade on CME after the exchange added OIS swaps and some other over-the-counter interest rate swaps to their clearing capabilities last week.

Asif Mohamedali, the former head of European flow credit trading at Credit Suisse in London, has joined Prism Financial Products, a buyside brokerage.

Australia could introduce mandatory clearing of over-the-counter US dollar, sterling, euro and yen interest rate swaps in early 2015, with rules on the new regime expected to be issued late 2014.

The increasing likelihood of the five-year CMS rolling down in two years’ time, driven by inflation and potential quantitative easing from the European Central Bank, has opened up the opportunity to sell two-year in-the-money digital caps on the underlying.

The volume of interest rate swap trading on swap execution facilities dropped by between 30%-40% during the first week of mandatory trading, according to Colby Jenkins, research analyst at TABB Group.

CME Clearing Europe is adding a series of new interest rate swaps to its existing interest rate swap offering ahead of the start of mandated clearing in Europe, which is slated for later this year.

Electronic networks for trading over-the-counter financial instruments such as swaps are set to become much more efficient after the FIX trading community adopted a standardisation initiative on Thursday. The move will help firms with the transition from manual to automated dissemination of information between dealers and clients.

Open interest in US dollar-denominated interest rate swap futures on Chicago-based futures bourse Eris Exchange has reached $10bn in notional value.

The European Securities and Markets Authority plans to adapt its definition of liquid instruments to ensure certain derivatives, which may only be liquid for a short period of their life, are caught under transparency regulation.