A shift in chunks of euro derivatives clearing from London to European Union countries is now inevitable and banks should get ready, industry officials were told on Wednesday, but others warned the EU intervention would backfire.
The EU wants to directly supervise clearing worth trillions in euro rate swaps and
Euribor futures, and rely less on a post-Brexit London.
EU permission for UK clearers to continue serving EU clients is due to expire in June next year.
"The direction of travel is very clear... everyone needs to be prepared, set up, be capable of doing business in the EU," Matthias Graulich, a executive board member at Eurex Clearing, the Deutsche Boerse
, opens new tab unit in Frankfurt that will benefit from the new law.
"I think effectively we are starting with this requirement in the second quarter of next year probably, so it gives us a good year to prepare," Graulich told the annual IDX derivatives conference, adding that "huge numbers" of customers have hooked up to Eurex Clearing.
"A third of those 650 clearing members and clients are regularly active. Everyone else is observing the situation," Graulich added...
© Reuters
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