Gold Not Money? CME Clearing Europe To Accept Gold As Collateral

August 17, 2012 at 12:59

truthing

CME Clearing Group, the London-based clearing house wholly-owned by CME Group, the world’s leading and most diverse derivatives marketplace, today announced it has extended the range of eligible collateral types to include gold bullion.

The extension offers additional flexibility at a time when high quality collateral is at a premium and the clearing of over-the-counter (OTC) derivatives is increasing. CME Clearing Europe has followed the lead of CME Clearing, which has accepted gold to cover margin requirements since October 2009.

Launched in May 2011, CME Clearing Europe currently clears OTC commodity derivatives and plans, subject to regulatory approval, to introduce OTC Interest Rate Swap clearing later this year.

CME Clearing Europe is an FSA regulated, multi-asset class clearing house based in London that offers more than 200 OTC products for clearing. Its clearing model ensures stability and increases transparency in the OTC markets that it clears. CME Clearing Europe has its own dedicated staff, and its governance arrangements, capital and default resources are separate from those of CME Clearing in the US. As part of CME Group it nonetheless has full access to the to the clearing and risk management expertise, systems and financial strength of CME Clearing.