Agent Clearing Service

Delivering broader access to central clearing, enhanced flexibility, and resilient risk management for the U.S. Government securities market.

• Overview

  FICC’s Agent Clearing Service enables eligible Netting Members (“Agent Clearing Members”) to act as in an agented capacity on behalf of their clients (“Executing Firm Customers”) to submit eligible securities transactions into FICC. FICC interacts solely with the Agent Clearing Member for day-to-day processing and settlement obligations.

• Benefits

  • Reduction of Counterparty Risk: Central clearing reduces counterparty risk through FICC’s guarantee of settlement in a member default scenario.
  • Balance Sheet & Capital Relief: Novation and balance-sheet netting at FICC may reduce capital usage for Agent Clearing Members who may be able to offset their obligations to FICC on their Agent Clearing Transactions against their other FICC-cleared activity.
  • Market Liquidity: Greater access to central clearing for institutional firms and cash providers supports increased lending capacity and may mitigate risk during stress events
  • Execution Flexibility: FICC’s access models expand counterparty choice while maintaining the benefits of central clearing.
  • Margin Efficiency: Agent Clearing Members may see enhanced margin efficiency due to the net margining capability the Service offers across Executing Firm Customers whose activity is recorded in the same Agent Clearing Member Omnibus Account that is not a Segregated Indirect Participant Account.

• Member Eligibility

  • Executing Firm Customers Eligibility: Executing Firm Customers are not members of FICC and would need to have at least one Agent Clearing Member willing to act as processing agent on their behalf to participate in the Service.
  • Agent Clearing Members Eligibility: Full-service Netting Members of FICC/GSD are eligible to participate. IDB Netting Members are not eligible; but may apply if they are also GSD Dealer Netting Members, in their capacity as Dealers.

• Current Service Offerings

  ACS DVP Service: Enables clients to lend cash or eligible collateral via FICC-cleared Delivery-vs-Payment (DVP) repo transactions in U.S. Treasury and Agency securities on an overnight and term basis, as well as outright purchases and sales of such securities, settled on a DVP basis.

  Eligible security types include:

  • U.S. Treasury Bills, Bonds and Notes
  • U.S. Treasury Inflation Protected Securities (TIPS)
  • U.S. Treasury STRIPS
  • Non-Mortgage-Backed Agency Securities
  • Floating Rate Notes (FRNs)

  Operational Mechanics:

  • Trade Execution: Agent Clearing Transactions are executed away from FICC.
  • Trade Model: Transactions are executed as done-with or done-away.
  • Trade Submission: For done-with activity, the Agent Clearing Member submits both sides of the transaction to FICC. For done-away activity, the Agent Clearing Member submits the Executing Firm Customer’s side of the transaction with the Executing Firm Customer’s 4- or 5- character identifier and the counterparty side of the transaction is submitted by the Indirect Participant’s intermediary or a Netting Member other than the Executing Firm Customer’s Agent Clearing Member (“Done-away Netting Member”).
  • Trade Matching: Both sides of the Agent Clearing Transactions must be submitted to FICC for matching. It is highly recommended that the counterparty submit matching trade details with the Executing Firm Customer’s 4- or 5- character identifier in the Contra Executing Firm field.
  • Novation: Upon comparison, Agent Clearing Transactions are novated to FICC.
  • Settlement: Settlement of Agent Clearing Transactions occurs as follows -
  • Cash Settlement: All forward settling cash trades are netted and settled with FICC.
  • Start Leg Settlement:
  • Currently, the start leg of a Same-Day Settling Done-with repo transactions and forward starting repo transactions settle with FICC. Subject to regulatory approval, ACS DVP repo will align with the Sponsored DVP service where the start leg of a Same-Day Settling Done-with repo will settle away from FICC.
  • Same-Day Settling Done-away repo transactions settle with FICC on a trade for trade basis at contract value.
  • End Leg Settlement: All end legs are netted and settled with FICC.
  • Haircuts: An Agent Clearing Member and Executing Firm Customer can elect (as a commercial matter) to apply a haircut in the form of additional collateral above 100% of the cash value lent.

  Proposed Agent Clearing Service (ACS) Tri-party Repo Service*: Allows Agent Clearing Members to submit tri-party repo transactions of their Executing Firm Customers (“ACS Tri-party Trades”) to FICC on a general collateral basis, in the same asset classes eligible for the GCF Repo® Service and Sponsored GC Service and settle those transactions on the tri-party repo platform of an ACS Tri-party Clearing Agent Bank.

  • ACS Tri-party Trades are transacted using the following Generic CUSIP Numbers:

  Generic CUSIP	Description
  84910LAB2	U.S. Treasuries < 10 Yr Maturity
  84910LAA4	U.S. Treasuries < 30 Yr Maturity
  84910LAC0	Non-Mortgage-Backed U.S. Agency Securities
  84910LAD8	Fannie Mae and Freddie Mac Fixed Rate MBS.
  84910LAE6	Fannie Mae and Freddie Mac Adjustable Rate MBS
  84910LAF3	Ginnie Mae Fixed Rate MBS
  84910LAG1	Ginnie Mae Adjustable Rate MBS
  84910LAH9	U.S. Treasury Inflation Protected Securities (“TIPS”)
  84910LAJ5	U.S. Treasury STRIPS

  Operational Mechanics:

  • Trade Execution: ACS Tri-party Trades are executed away from FICC.
  • Trade Model: ACS Tri-party Trades can be executed on a done-with or done-away basis.
  • Trade Submission/Matching (tri-party repo platform): All ACS Tri-party Trades must be submitted to the tri-party repo platform of an ACS Tri-party Clearing Agent Bank for matching. The collateral provider must submit their trade details with a Dealer Reference that mirrors the Master Reference it would send on its trade submission to FICC.
  • Trade Submission/Matching (FICC): For done-with activity, the Agent Clearing Member submits both sides of the ACS Tri-party Trade to FICC for matching. For done-away activity, the Agent Clearing Member submits the Executing Firm Customer’s side of the trade with the Executing Firm Customer’s 4- or 5- character identifier and the counterparty side of the trade is submitted by the intermediary of the Indirect Participant or a Done-away Netting Member. In addition, the collateral provider must submit their trade details to FICC with a Master Reference that mirrors the Dealer Reference it submitted on its trade to the tri-party repo platform.
  • Collateralization: Each ACS Tri-party Trade is required to be fully collateralized with securities eligible under the applicable GC CUSIP Number and/or cash.
  • Start Leg Settlement: Consistent with the manner in which tri-party repo transactions are settled today outside of central clearing, the Start Leg of an ACS Tri-party Trade settles on a trade for trade basis on the tri-party repo platform of an ACS Tri-party Clearing Agent Bank.
  • Novation: Novation to FICC of the End Leg of an ACS Tri-party Trade occurs after the Start Leg of the ACS Tri-party Trade has fully settled on the tri-party repo platform of an ACS Tri-party Clearing Agent Bank and the ACS Tri-party Agent Bank has provided FICC with a reporting of such settlement and the specific securities that were delivered for start leg settlement.
  • Repo Interest: The ACS Tri-party Clearing Agent Bank on FICC’s behalf, administers the collection and payment of repo interest on a daily basis between the Agent Clearing Member and Executing Firm Customer (deadline 12:00 PM NYT, except on the end leg settlement date where the interest is passed as part of the end leg settlement).
  • Haircuts: An Agent Clearing Member and Executing Firm Customer can elect (as a commercial matter) to apply a haircut in the form of additional collateral above 100% of the cash value lent.

• Risk Management

  Funds-Only Settlement: Agent Clearing Member acts as the processing agent of its Executing Firm Customer(s) trades (“Agent Clearing Transactions”) and is responsible for satisfying any Funds-Only Settlement (FOS) obligations attributed to its Executing Firm Customers’ activity, as if it had executed such activity itself.

  Clearing Fund: Agent Clearing Members are responsible for posting Required Fund Deposits calculated with respect to their Executing Firm Customers’ activity, calculated twice daily on a net (for non-segregated Agent Clearing Member Omnibus Accounts) or gross basis (for Segregated Indirect Participants Account; such margin is referred to as Segregated Customer Margin).

  Liquidity & Loss Allocation: Agent Clearing Members are responsible for any Capped Contingent Liquidity (CCLF) and loss allocation obligations attributed to their Executing Firm Customer(s) activity.

  *Service availability is subject to SEC approval of a proposed rule change filing (SR-FICC-2025-021).

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  Disclaimer: The statements and other information available on and through this page, including information in any links and documents available on this page, are for informational purposes only. Please refer to the GSD Rules for descriptions of the rules, procedures, and all rights, obligations, and other requirements of both FICC and its participants in connection with their use of GSD’s services. In the case of any discrepancy between the information available here and the GSD Rules, the GSD Rules govern.