The European Union will struggle to force a large-scale migration of euro swaps clearing onto its shores without causing serious harm to its own banks as well as EU regulators' ability to police these markets, industry experts have warned. The EU has captured a large chunk of euro interest-rate swaps trading activity this year amid a post-Brexit regulatory impasse with the UK. But there has been no mass movement of euro interest-rate swap clearing out of London, with the UK's LCH still accounting for roughly 96% of new clearing volumes in January and February, according to data from research and analytics firm ClarusFT. The stickiness of clearing activity will frustrate EU leaders and underlines the challenges they face in attempting to wrest control of the euro swap market out of London's grasp.
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