Overboard: ditching clients imperils Treasuries clearing mandate
Standardised docs a drop in the ocean as dealers eye potential costs of sponsored Treasuries clearing
Large US dealers are warning that the practice of so-called offboarding of inactive or unprofitable clients poses a substantial obstacle to the Securities and Exchange Commission’s (SEC) drive for mandatory central clearing of repo and cash US Treasuries transactions.
“There seems to be an underlying expectation that all the banks are going to happily bring in every possible client out there,” says Mike Cloherty, head of US rates strategy at UBS. “Dealers don’t even keep folks they have a
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