LCH launches new model for buy side repo clearing

LCH’s RepoClear service has introduced a new model to bring the benefits of clearing repos to the buy side. Insight Investment is the first asset manager to clear a trade, acting for a UK pension fund it manages, as a sponsored member, with NatWest Markets  supporting Insight’s trade as the agent member. The first trade was executed on Tradeweb Markets.

Buy side firms such as pension funds are now able to access the service via a sponsorship model, whereby an agent bank provides support to the sponsored member. This support includes facilitating margin payments and providing default fund contributions for transactions made by the sponsored member.

This expansion of LCH’s membership to the buy side increases multilateral netting opportunities for members, increasing capital efficiency and capacity in the market. The model is initially available for the 11 government debt markets cleared by LCH, with plans to roll out to the clearing house’s continental European arm, subject to regulatory approval.

Read the full release

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