Considering the global regulatory drive for CCP clearing coupled to increase international trade liquidity in the SA bonds market, the desire for establishing a Bonds CCP was raised at the Bonds ETP Market Committee meeting in December 2021.
The Johannesburg Stock Exchange (JSE) is embarking on creating a Centralised Clearing platform for the Bonds market.
- Greater trade liquidity and participation from international market participants by aligning our clearing risk models to global standards;
- Better market protection through reduced counterparty credit risk, increased transparency and standardised processes;
- Lower regulatory capital and margin costs through multilateral netting and cross-product margin offset;
- Reduced administrative and operational complexities of needing to perform individual credit assessments and signing of GMRAs for bilateral trading; and
- Increased options for client clearing due to an increase in CCP clearing members.
