
In the process of clearing swaps, the clearing house becomes the
central counterparty to, and has responsibility for, the corresponding
trade obligations arising from each half of the original bilaterally
negotiated trade. This principle is known as registration and is
the same role that was explained earlier in respect of the clearing
of exchange-traded derivatives.
SwapClear offers the interbank swap market a facility that aims to
free up credit lines, reduce risk and use of capital, thus increasing
return on investment and trading opportunities.
The extent of these benefits will depend on the ...