She explained: “We want to be able to preserve choice, so wherever the Commission gets on that, we want to make sure we’re still able to access CCPs, and I’m sure the supply will continue to grow. improve and expand, but we also want to be able to access London for compensation purposes.”
The EU is particularly concerned about what Ms McGuinness described as an “overreliance” on London with the long-term aim of building clearing capacity in financial centers such as Paris and Frankfurt.
Ms Yavari said: “We understand that there is systemic risk with the clearing volume that is currently taking place with UK CCPs, so to the extent that the EU would like to see some reduction in that, we can understand that, but we think it’s something that needs to happen organically and not the result of some sort of regulation that prohibits access to UK CCPs.”
The harsh 2025 deadline has also caused confusion in the UK, with Bank of England Governor Andrew Bailey saying there was no need to set a deadline and warning Brussels against “fragmenting the international system”.
Despite EU efforts, banks have so far been reluctant to change their clearing habits, adding to the frustration of Ms McGuinness who warned: “It’s not going to happen organically, it’s is why we will have to intervene”.