Financial News’ Michelle Price looks at the progress being made in the Asian markets towards clearing. It focuses on the six jurisdictions in the region – Hong Kong, Singapore, Australia, Japan, South Korea and India – who have committed to building OTC derivatives clearing houses.
These new ventures will struggle to compete against the established international OTC clearing houses, however market experts speculate that the high level of regulatory uncertainty in the region means there is everything to play for. To succeed in the region, newcomers may need to specialise in local currencies and other regional services.
GreySpark comments that not all will survive, as there is simply not enough volume for multiple independent, non-cooperating clearers. Additionally, they will be looking to beat each other on variety of factors.
The article goes on to look at the various challenges that local clearers will face, as well as pointing out areas that they may succeed in.