Royal Bank of Canada Joins Forces with ICE Clear Credit to Enhance Credit Default Swap Clearing 

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Intercontinental Exchange, Inc., a dominant player in the global financial technology and data landscape, announced today a significant development for its credit derivatives clearinghouse, ICE Clear Credit LLC. Royal Bank of Canada (RBC), boasting the title of Canada’s largest bank by capitalization and recognized as one of the world’s global systemically important banks (G-SIBs), has become a clearing member of ICE Clear Credit.

This strategic partnership brings together a premier financial institution with a leading credit default swap (CDS) clearinghouse. RBC will gain access to a comprehensive suite of clearing solutions offered by ICE Clear Credit, including:

Robust Mark-to-Market Services: Real-time price adjustments minimize potential losses and ensure accurate portfolio valuation.

State-of-the-Art Risk Management: ICE Clear Credit employs cutting-edge risk management practices to safeguard the clearing ecosystem.

Access to Leading CDS Instruments: RBC can leverage industry-leading solutions for clearing Single Name and Index CDS products, as well as CDS Index Option instruments referencing key North American and European corporate indices.

“By leveraging central clearing for our entire portfolio of actively traded CDS products through ICE Clear Credit, RBC can unlock significant capital and operational efficiencies,” stated Santosh Sateesh, Managing Director and Global Head of Credit Derivatives Trading at RBC.

Stan Ivanov, President of ICE Clear Credit, expressed his enthusiasm about the collaboration: “RBC’s stature as a global leader in the financial services industry makes them a highly valued addition to our clearing membership. Their participation strengthens our world-class roster and further bolsters the leading liquidity we offer within the global CDS market.”

Launched in 2009, ICE Clear Credit’s clearing solutions have become a cornerstone of the CDS market. They offer clearing for a diverse range of over 500 Single Name and Index CDS instruments, encompassing both corporate and sovereign debt. This centralized clearing approach has significantly mitigated counterparty risk exposure, with over $330 trillion in two-sided notional value cleared and an open interest of approximately $1.75 trillion.

The alliance between ICE Clear Credit and RBC signifies a significant step forward in enhancing the stability and efficiency of the CDS market. By providing RBC with access to advanced clearing solutions and risk management practices, this partnership fosters a more secure and streamlined trading environment for all participants.