Banks gear up for client clearing

Politicians want the derivatives market to be rebuilt around clearing houses, but only the big dealers are likely to become direct members – they will provide access for the rest of the market through new client clearing services. But what will these services look like, how will they work, and what will they cost? By Duncan Wood

Earlier this year, Dutch asset manager Robeco started asking its banks about the embryonic client clearing services that are intended to give thousands of derivatives users access to central counterparties (CCPs), in line with rules now being fine-tuned on both sides of the Atlantic. Of the eight banks Robeco approached, only five were able to provide a concrete pricing schedule for their services. Of those five, the most expensive was double the cost of the cheapest, says Erik van Leeuwen, head