CME Group and GCSA Capital are developing the Prefunded Treasury Facility (PTF) as a permitted form of collateral at CME Clearing for performance bond (initial margin) requirements for clearing members’ proprietary positions in futures and options contracts. The PTF is a letter of credit issued by a bankruptcy-remote trust that is fully collateralized and secured by US Treasury securities that are deposited into a custody account controlled by CME Clearing. The PTF is designed to be an efficient, lower cost, and more stable form of term funding for clearing members.
“We’ve worked closely with GCSA Capital over the past two years to ensure that the design of the PTF program is aligned with CME’s risk management standards for acceptable collateral and provides efficiencies to our clearing members,” said Sunil Cutinho, President, CME Clearing.
“As a clearing member, we appreciate this initiative by CME Clearing and GCSA Capital to develop flexible funding solutions for market participants,” said Michael Parodi, Director, Credit Suisse.