CHICAGO, Feb. 20,
2024 /PRNewswire/ -- CME Group, the world's
leading derivatives marketplace, today announced that nine market
participants have cleared over-the-counter (OTC) Mexican Overnight
Funding Rate (F-TIIE) index swaps since the company launched its
clearing service on February 5. The
cleared F-TIIE overnight index swaps (OIS) represent more than
4.3 billion pesos (the equivalent of
$250 million) in notional value and
support Banco de México's transition from its benchmark Interbank
Equilibrium Interest Rate (TIIE) to the F-TIIE rate.
Market participants who have already cleared these swaps through
CME Group include Banorte, BBVA, Goldman Sachs, HSBC, J.P. Morgan,
Morgan Stanley, and Santander.
"Our new swaps clearing service provides critical infrastructure
for clients navigating the F-TIIE benchmark transition," said
Agha Mirza, CME Group Global Head of
Rates and OTC Products. "Looking forward, we will continue to work
to deliver capital efficiencies to market participants to help
advance the development of Mexico's derivatives marketplace."
"Banco de México is fully committed to the development of
financial instruments linked to Funding TIIE (F-TIIE)," said
Gerardo Garcia, General Director of
Central Bank Operations at Banco de México. "In this sense, the
launch by CME Group of the OIS contracts linked to F-TIIE is a
milestone for market development and undoubtedly speeds up and
facilitates the transition towards the prevalent use of this rate
as the main reference rate in Mexican pesos."
"The transition to risk-free-rates has picked up pace, and the
market's ability to risk manage exposures linked to Banco de
México's TIIE de Fondeo Rate is another important step on that
journey," said Tony Evangelista,
Executive Director, LatAm Trading at J.P. Morgan. "J.P. Morgan is
delighted to be one of the first participants to clear F-TIIE OIS
instruments at CME Group, and we look forward to the market's
continued development."
"The successful launch of F-TIIE OIS clearing by CME Group marks
a significant milestone in Mexico's transition to a risk-free rate," said
Manuel Meza, Head of Global Markets
at BBVA Mexico. "As a commercial bank, we are excited to see
continued developments in this transition in order to best serve
our customers."
In addition to clearing F-TIIE index swaps, CME Group offers
F-TIIE futures, which trade alongside SOFR futures and MXN/USD FX
futures, providing a comprehensive hedging solution for the short
end of the Mexican interest rate curve.
For more information on clearing F-TIIE index swaps at CME
Group, please visit
https://www.cmegroup.com/articles/2023/transition-from-28d-tiie-to-tiie-de-fondeo-f-tiie-for-cleared-mxn-interest-rate-swaps.html.
As the world's leading derivatives marketplace, CME Group
(www.cmegroup.com) enables clients to trade futures, options, cash
and OTC markets, optimize portfolios, and analyze data – empowering
market participants worldwide to efficiently manage risk and
capture opportunities. CME Group exchanges offer the widest range
of global benchmark products across all major asset classes based
on interest rates, equity indexes, foreign
exchange, energy, agricultural
products and metals. The company offers futures and
options on futures trading through the CME Globex platform,
fixed income trading via BrokerTec and foreign exchange trading on
the EBS platform. In addition, it operates one of the world's
leading central counterparty clearing providers, CME
Clearing.
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SOURCE CME Group