Nasdaq Clears Fund’s First Trade of Nordic Interest-Rate Swap
Nasdaq OMX Group Inc., operator of seven Nordic and Baltic exchanges, said its clearinghouse in the region processed a fund manager’s interest-rate swap for the first time, as new regulations create opportunities to expand.
Nektar Asset Management conducted the trade, Hans-Ole Jochumsen, executive vice president for Nordic transaction services at Nasdaq, said in an interview.
“This is the next step,” Jochumsen said. “In the first quarter of 2014, we will see more institutional clients.”
The U.S. Dodd-Frank Act requires clearing for most swap contracts, while international regulations under the Basel III accords encourage the use of clearinghouses for the derivatives through favorable capital treatments. The European Commission is also working on legislation, called the European Market Infrastructure Regulation, that would govern most aspects of clearing. London-based LCH.Clearnet Group Ltd. is the world’s biggest interest-rate swap clearinghouse.
Nasdaq split its exchange and clearinghouse in the region earlier this year to comply with European regulations. It is now seeking to clear interest-rate swaps denominated in Danish kroner, Norwegian kroner and euros.
The company started clearing Swedish kronor-denominated interest-rate swaps in 2012, with members submitting interbank trades since April 22, 2013.
Nasdaq OMX Clearing has about 220 billion kronor ($33 billion) of open interest in Nordic interest-rate swaps, Jochumsen said.
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