Murray Pozmanter is DTCC managing director and general manager, Clearing Services, and chairman of the Board of the newly launched New York Portfolio Clearing (NYPC) derivatives clearinghouse. @dtcc sat down with Pozmanter to discuss the launch of NYPC and the role of the Board in NYPC’s operations.
How did the first weeks of operation go for NYPC?
From an operational point of view, things went very smoothly. In fact, NYPC exceeded our volume expectations for the initial weeks. After the first day of operation, we’ve been averaging north of 50,000 contracts a day in Eurodollar futures. The March 28 addition of Treasury futures started off somewhat more slowly than the Eurodollar futures, but as more firms begin trading on the platform, we expect to see activity in those instruments pick up.
On the FICC side, we were carefully monitoring the transition to twice-daily margining for all our GSD [Government Securities Division] members, and that went smoothly as well. Our customers are adapting to the new margining regime quickly.
Murray Pozmanter DTCC managing director and general manager, Clearing Services, and chairman of the NYPC Board
What is the role of the NYPC Board?
It’s a fully independent Board separate and apart from the DTCC structure. When we started the DCO [Derivatives Clearing Organization] application process, the Commodity Futures Trading Commission, which is NYPC’s primary regulator, was adamant about establishing the independence of NYPC from the rest of DTCC. As such, we structured the Board as a standalone entity that would have representation from the parent companies, DTCC and NYSE Euronext, as well as independent board members who would represent different parts of the industry and serve as sounding boards and advisors to the rest of the Board.
Independent director Bernie Dan, for example, has a world of experience in futures as past chairman of the Chicago Board of Trade and past chairman of MF Global. Tom Wipf of Morgan Stanley was formerly on GSD’s Board and has a wealth of experience in fixed income and financing markets. Richard Prager of BlackRock represents the institutional investors, and we view that segment of the industry as an area of opportunity for NYPC. So, all in all, we have significant representation on the Board from key groups and areas in which NYPC operates or plans to be involved.
What is the plan for bringing on other exchanges to clear through NYPC?
If any exchange wants to use NYPC as a derivatives clearing member, we are open to beginning the discussions immediately. @