MarkitSERV has introduced a service that will help privately traded derivatives between banks be processed in near-real time, Financial Times reports. The near-real-time clearing for credit-default swap (CDS) trades has been tested by several large dealers. The existing process requires up to five days.
The service was utilized last week by Deutsche Bank, J.P. Morgan and Morgan Stanley, which sent trades within minutes to IntercontinentalExchange’s clearing house ICE Credit Clear. An estimated 20 percent of the notional $15,000 billion CDS market is routed through clearers. Rules for obligatory clearing are still in the making.
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