The upcoming mandatory clearing of US Treasury securities, with deadlines set for December 2026 (cash transactions) and June 2027 (repo transactions), is prompting significant industry preparation. We understand that this regulatory shift presents complex operational, regulatory, and legal challenges for market participants.

Key considerations include:

• Clearing Models: The industry is actively evaluating ‘done-with’ and ‘done-away’ clearing models, seeking optimal solutions for diverse needs.
• Clearing Houses: While FICC currently clears Treasuries, the potential for additional clearing houses like CME Group and ICE raises questions about liquidity and netting benefits..
• Clearing Members: Balance sheet capacity and margin treatment are critical factors influencing how clearing members will operate, impacting buy-side business models.
• Technology and Infrastructure: Firms are exploring technology solutions, including the role of third-party vendors, to address risk checks, post-trade processing, and venue access.

The path towards US Treasury clearing

Market participants are seeking flexibility and choice in access models and clearing houses. We recognise the importance of providing robust solutions that address these evolving needs.
OSTTRA is actively developing services to support US Treasury and repo clearing, including:

• our existing LimitHub service for pre- and post-trade credit checks, as the only production “Credit Hub”, adopted by all major Clearing Members and Trading Venues.
• our established MarkitWire and Trade Manager platforms, providing repo partial matching and affirmation, and we will be adding trade routing capabilities, full matching and CCP connectivity.

Drawing upon extensive expertise in Interest Rate Swaps and acknowledging the critical global role of the US Treasury system, we are engineering operational tools to enhance efficiency. These include Commercial Service Monitoring for improved resiliency and exception management, consolidated real-time views of clearing cash and repo activity, and a simplified onboarding process for industry participants, via OSTTRA OCO.

We acknowledge the industry’s concerns regarding scalability, profitability, and technology investment. We are working closely with market participants to develop solutions that address these challenges.

As the industry prepares for these regulatory changes, OSTTRA is committed to providing adaptable and efficient solutions.

This page will be updated as regulatory developments and industry needs evolve.

We encourage you to contact us to discuss your specific requirements and how we can help you navigate the evolving landscape of US Treasury clearing. For more information, please complete the form below.