Just days after revealing swinging price cuts, LCH.Clearnet has stepped up the pressure on rivals by agreeing new competitive clearing offerings for European MTFs Bats Europe, Chi-X, Turquoise and Nyse Arca Europe.
The new agreements will see LCH.Clearnet going head to head with incumbent clearers EMCF at Chi-X and Bats, and EuroCCP at Turquoise and Nyse Arca.
Earlier this week LCH.Clearnet moved to slash its cash equity clearing fees by a third for the Nyse Euronext, Bourse de Luxembourg, Equiduct and SmartPool markets beginning in July. This was swiftly followed by a seven per cent average reduction in tariffs on EquityClear, which is used in the London markets.
The moves are a boost to brokers and EU parliamentarians who have long complained about the cost of clearing in European equities trading.
Hirander Misra, COO, Chi-X Europe says the introduction of competitive clearing should "ensure competition and efficiency at the lowest possible frictional cost".
At Turquoise, LCH.Clearnet will work not only with EuroCCP, but also Swiss clearer x-clear, following the agreement of an interoperability pact between the latter two platforms late Thursday. LCH.Clearnet already competes against x-clear in the London market following the LSE's introduction of competitive clearing in September last year.
Separately, LCH.Clearnet announced plans to begin clearing over-the-counter iron ore swaps, a development which should provide a boost to the nascent spot market and signal a move away from reliance on the traditional system of annual price benchmarking.
The new product complements the clearer's existing OTC Freight service.