Eurex Clearing, one of the leading central counterparties (CCPs) globally and part of Deutsche Börse Group, has cleared its first €STR swap trades. The clearing of these euro-denominated swaps is an important milestone in both the establishment of €STR as the new benchmark risk-free rate, and in expanding Eurex’s EUR-denominated product offering.

BNP Paribas, Citi, Deutsche Bank, J.P. Morgan, LBBW, Morgan Stanley, Nordea and UniCredit were the first to trade €STR swaps cleared at Eurex Clearing. Along with a number of other banks they will continue to provide liquidity and price transparency via Bloomberg and Tradeweb’s execution platforms.

The switch from EONIA to €STR, the new euro short-term rate, forms part of broader IBOR reform. The ECB began officially publishing €STR on 2 October 2019. Eurex Clearing supports these regulatory efforts to gain control over systemic market components such as overnight reference rates.

Campbell Gilbert, Head of European Swaps Trading at Deutsche Bank, says: “We are very happy to be among the first to clear €STR swap trades in Frankfurt, and further emphasize Deutsche Bank’s leadership as a Market Maker in euro-denominated swaps. We were also delighted to see the market’s immediate focus on building liquidity and great support for this new offering from Eurex Clearing.”

Magnus Inness, Head of Flow Derivatives Trading, at UniCredit, says: “As we transition to an alternative, risk free rate environment, it is vital that we develop a strong cleared market. Supporting the development of a new benchmark underpins our commitment to helping our clients effectively manage and execute their risk exposure in a transparent, cost effective manner.”

Thilo Rossberg, Head of FICC Markets, at LBBW says: “We are encouraged by the smooth introduction of clearing for €STR swaps in Frankfurt. This is a vital step for the development of a vibrant and liquid market in this new instrument. We will continue to be at the forefront of such developments in order to offer our clients the best possible tools to manage their risk positions.”  

“We are delighted to have now cleared the first €STR swaps in Frankfurt”, says Matthias Graulich, Member of the Eurex Clearing Executive Board. “As €STR is maintained by the ECB, its establishment represents an important part of strengthening regulatory control within the EU27. Eurex Clearing is fully supportive of these efforts, as shown by the clearing of these €STR swap trades as well as other innovations such as our approach to build an EU27-based alternative for euro swaps clearing.”