DTCC Unveils OTC Derivatives Matching Service; G14 Dealers Go Live

The Depositary Trust & Clearing Corp. announced the launch of a global over-the-counter equity derivatives cash flow and netting platform, a service it said is now being used by the 14 largest international dealers.

The DTCC said the service was created as part of a pledge by the G14 to the U.S. Federal Reserve that it would strengthen the operational infrastructure of the OTC derivatives market.

“In an environment where risk mitigation is paramount, the OTC derivatives community has placed great priority in promoting improved certainty in the market,” J.P. Morgan managing director Lawrence Waller said in a statement. “The new automated cash flow matching and netting process for OTC equity derivatives facilitates seamless and timeless settlement.”

The DTCC added that the new platform is the first of its kind for the OTC equity derivatives market. It will initially service vanilla options and swaps traded between the G14 dealers.

“CFM is an important step in furthering regulatory and industry objectives to bring greater transparency and risk mitigation to the global OTC equity derivatives market,” Martin Gould, the director of market initiatives at Deutsche Bank said in a statement.

As the Senior Editor of Advanced Trading, Justin Grant plays a key role in steering the magazine's coverage of the latest issues affecting the buy-side trading community. Since joining Advanced Trading in 2010, Grant's news analysis has touched on everything from the latest ... View Full Bio