As their clearing exemption expired in June 2023, EU-domiciled pension funds need to be able to access at least one CCP for their OTC IRD Clearing strategy. In addition, UMR 6 has a significant impact in terms of legal, operational and technological resources and costs. Adopting Eurex Clearing’s integrated service offering can reduce these impacts.
As a multi-asset CCP, Eurex Clearing can help pension funds optimize their access to cleared derivatives. Eurex Clearing enables clients to combine interest rate swaps, inflation swaps and exchange-traded derivatives into a single account. When clearing new interest rate swaps, pension funds can benefit from Eurex Clearing’s deep euro liquidity pool. Legacy positions can be selected for clearing to benefit from portfolio margining offsets.
Participants can achieve significantly reduced costs when margins are funded through the Eurex Repo platform using the broad collateral range. Complimented with best execution, this leads to enhanced returns to end investors.
Having access to Eurex’s liquid and centrally cleared repo markets enables clients to safely invest cash or raise short-term funding with more than 150 Eurex Repo trading participants, all under a standardized legal agreement, with straight-through processing and no need for bilateral credit lines.