SA Acceptable Collateral

Cash and securities collateral eligible to be posted as margin at LCH SA.

Margin Requirements

In order to guarantee the net positions of Clearing Members and to be able to manage the risk of a Clearing Member’s default, LCH SA requires from its Clearing Members to deposit eligible Collateral to cover their corresponding margin requirements as called by LCH SA. These Margin requirements include, inter alia, Initial Margin, Variation Margin and Intraday Margin which are calculated on a daily basis for all positions of a Clearing Member on all markets and per clearing service: RepoClear, CDSClear and DigitalAssetClear.

Margin requirements at LCH SA can be covered by high-quality liquid assets (HQLA) including cash and certain securities.

For further information on Margin calculation and Margin calls please refer to the relevant Instructions, CDS Clearing Procedures and Risk Notices available on the following pages:

Centralisation of Collateral Management

Eligible Collateral Summary

LCH SA accepts deposits of cash and securities to cover margin requirements. Clearing Members can satisfy their margin requirements using the following possibilities:

 
  CDSClear DigitalAssetClear RepoClear
1. EURO cash Yes Yes Yes
2. USD or GBP cash[1] Yes Yes Yes
3. Securities Collateral[1] Yes Yes Yes
4. Central Bank Guarantee No No Yes
5. Pledge solution[1] Yes No Yes

[1] Not accepted to cover the Default fund contribution

Rules and Regulations

Instruction IV.4-1[2] Instruction IV.4-1[2] CDSClear Section 3: Collateral and Cash Payment[2]
(For RepoClear) (For DigitalAssetClear) (For CDSClear)

[2]Protection against third parties' claims:

Collateral transferred to LCH SA is subject to all applicable legal and regulatory provisions governing Collateral provided to a clearing house, including, without limitation, Article L. 440-7 and L. 440-8 of the French Monetary and Financial Code.

Contribution to the relevant Default Fund transferred to LCH SA is subject to all applicable legal and regulatory provisions governing securities settlement systems including, without limitation, Article L. 330-2 of the French Monetary and Financial Code.

In accordance with the provisions of Article L.440-7 and L. 330-2 of the French Monetary and Financial Code, collateral and contribution to Default Fund transferred to LCH SA are protected against third party claims. No creditor of either a Clearing Member or LCH SA, no representative of a Clearing Member and no insolvency official (mandataire judiciaire) appointed under French insolvency proceedings (under Book VI of the French Commercial Code) may claim any right, neither over the Collateral transferred for the purpose of meeting a Clearing Member's Margin requirement pursuant to the applicable LCH SA Clearing Rules, nor over any contribution to the relevant Default Fund, even in the context of an LCH Insolvency Proceeding or insolvency proceedings opened outside of France which are equivalent or similar to those set out in Book VI of the French Commercial Code.