March 12, 2020 / 11:25 AM / in 16 days

Eurex adds Japan to bolster its euro clearing battle with London

LONDON, March 12 (Reuters) - Eurex said on Thursday it has been granted regulatory permission to clear euro-denominated swaps for Japanese customers in a move that should help the German clearing house compete better with rival LCH in London.

Eurex, a derivatives trading and clearing unit that is part of the Deutsche Boerse Group, said permission from Japan’s Financial Services Agency means it can now offer euro clearing to customers based in Japan.

It already serves customers in the United States and the European Union.

“With this step, we further geographically expand our service offering into Asia and underline our commitment to becoming the global home of the euro yield curve,” Eurex Clearing CEO Erik Mueller said in a statement.

Citi bank said in the same statement that it would now use its link between Eurex and the Japanese market to “onboard” new derivatives clearing clients in Japan.

Eurex said Japanese institutions are very active in European fixed income futures on Eurex, and have also significant exposure in the euro swap market.

LCH, unit of the London Stock Exchange, remains the world’s largest clearer of euro-denominated interest rate swaps, but Eurex has said it is gaining market share.

Some EU policymakers and central bankers want to see large chunks of London-based euro clearing moved to the euro zone because of Britain’s departure from the EU in January. (Reporting by Huw Jones Editing by Chizu Nomiyama)

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