OCBC joins LCH SwapClear as direct clearing member
Strong demand for corporate loans to support growth in ASEAN and Greater China have driven demand for interest rate swaps.
Singapore, 21 September 2023 – OCBC announced today that its headquarters in Singapore has joined LCH SwapClear as a direct clearing member. LCH SwapClear is LCH’s Interest Rate Swap (IRS) clearing service offering the deepest liquidity and market access to 95% of the cleared IRS market.
All banking subsidiaries within OCBC Group – including OCBC Malaysia, OCBC Hong Kong and OCBC NISP in Indonesia – can leverage this membership to tap into LCH SwapClear’s deep liquidity and and interest rate products in 27 currencies including the Singapore dollar. This will help the Bank support demand for interest rate hedging instruments from its corporate customers. The membership thus reinforces OCBC’s One Group strategic approach to support accelerated business growth arising from its ASEAN-Greater China focus.
The number of OCBC over-the-counter (OTC) IRS transactions cleared by LCHC SwapClear has been growing. In the first eight months of 2023, the number of such transactions had already exceeded that of the full year 2022 by 10 percent. Through this membership, OCBC will be able to scale up its transaction volumes further while achieving cost efficiency and capital optimization.
Mr Kenneth Lai, OCBC’s Head of Global Markets, said: “Joining LCH as a direct clearing member is a natural step for OCBC as we have seen steady growth in transaction volumes and outstanding position size with LCH over the years. The benefits of better risk management, cost efficiency and deeper liquidity derived from being a direct clearing member are valuable. It will enable us to support our customers’ growth ambitions in ASEAN and Greater China.”
Isabelle Girolami, CEO, LCH Ltd: “We are pleased to welcome OCBC as a direct clearing member in Singapore as it looks to benefit from greater risk management and capital efficiencies. We look forward to partnering with OCBC in future product designs, together with other banks in Singapore, as we continue to grow our global offering and expand our presence across the APAC region.”