Barclays becomes the first European investment bank that offers over the counter (OTC) clearing of interest rate swaps with Eurex, via US registered futures commission merchant.

The news is picked up by The Trade, noting that the move serves to ensure maintained access to the market whatever happens on the Brexit front. Regarding the clearing house, Eurex, it is interpreted as a continued push into North America.

An alternative pool

The Trade has spoken with Stephen Lee, head of Barclays’ Prime Derivatives Services business in the Americas, who describes the connection to Eurex as driven by a client demand for an alternative liquidity pool in euro interest rate swaps, among other factors.

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“With Brexit, we could potentially see a move away from the dominant clearing house, which in this case is LCH, and Eurex had anticipated that. Following Eurex’s recognition in the US as an approved clearinghouse, we felt that we needed to provide access to ensure that if there was a shift from a liquidity standpoint, especially around euro swaps, we would be ready,” says Stephen Lee.