London Metal Exchange to give date soon for clearing platform launch
LONDON May 15 (Reuters) - The London Metal Exchange expects to announce a 2014 launch date for its self-clearing platform, LMEClear, within the next few weeks, LMEClear's chief operating officer said.
Trades on the LME, the world's largest metals marketplace, are currently cleared by clearing house LCH.Clearnet. A clearing house acts as an an intermediary between parties to a trade, in order to reduce the risk of one (or more) parties defaulting.
"To go final on a date we need to agree an exit date with LCH.Clearnet. We're close to agreeing that, we expect we'll announce it in the next couple of weeks," Adrian Farnham said at the IRN Metals Trading Operations and Technology summit in London on Wednesday.
The LME said in December 2011 it had decided to create a self-clearing platform. The move was seen at the time as a bid to make the world's largest base metals marketplace more attractive for a sale.
The LME was sold to Hong Kong Exchanges and Clearing Ltd late last year for $2.2 billion
Farnham said LMEClear will be compliant right from its launch with the new European Market Infrastructure Regulation (EMIR).
The regulation aims to bring transparency to the over-the-counter derivatives markets through mandatory clearing and reporting of those trades, estimated to be worth some $600 trillion globally.