Nasdaq OMX helps Polish clearing house prepare for EMIR
Polish clearing house KPDW CCP has deployed technology from Nasdaq OMX to help it meet the European Commission’s new EMIR rules on OTC derivatives.
Under EMIR, the majority of OTC derivatives will have to be centrally cleared via central counterparties. The rules are intended to reduce systemic risks in financial markets by removing the possibility that a default by a major bank, such as Lehman Brothers in 2008, could paralyse financial markets.
KPDW CCP is using is OTC clearing and risk software called Sentinel, which will also interact with the CSD system KDPW Stream as well as trade confirmation platforms such as MarkitWire and Swift Accord. It began clearing OTC derivatives in line with EMIR last month.
Sentinel forms part of its KDPW OTC clearing system, “to provide the robust real time risk management required by our clearing members,” said Iwona Sroka, president and chief executive of KDPW CCP. “We aim to maintain our leadership role as Poland’s de facto clearing house.”
KPDW CCP is jointly owned by the Warsaw Stock Exchange, the National Bank of Poland, and the State Treasury. In November, the Warsaw exchange adopted NYSE Euronext’s UTP trading platform, putting the city’s trading infrastructure on the same level as Paris, Amsterdam, Brussels and Lisbon.
According to the UK FSA, EMIR nominally entered force in August last year, but most provisions only apply after technical standards enter into force. The EU Commission adopted nine unchanged technical standards on 19 December; the EU Parliament and Council have until 19 February to approve or reject the standards. If accepted, the standards will come into effect 20 days after publication in the official journal of the European Union.