Key Takeaways
- The Securities and Exchange Commission (SEC) has granted firms an additional 12 months to prepare for the new central clearing rule, extending the deadline to December 2026 for cash transactions and June 2027 for repurchase agreements (repo).
- The volume of transactions cleared daily by FICC has grown exponentially, from a peak of $4.5 trillion in 2022 to an all-time high of $11.4 trillion in April 2025.
- By the end of year, FICC plans to introduce enhancements to address double-margining issues for money market funds and is working on expanding cross-margining capabilities.
SIFMA Ops 2025 hosted an engaging panel discussion in May on U.S. Treasury clearing, bringing together seasoned professionals to delve into the current and future state of Treasury market clearing.
The session featured Laura Klimpel, DTCC Managing Director and Head of Fixed Income and Financing Solutions at FICC, Nate Wuerffel, Managing Director at Bank of New York, and John Boyle, Principal Financial Services Consultant at Ernst & Young.
Related: Central Clearing's Role in Market Stability
Extended Timeline
The SEC finalized a rule in December 2023 that requires a significant portion of transactions in the Treasury and Treasury repo markets to be centrally cleared. A major discussion point for the panelists centered on the SEC's announcement to extend the implementation timeline, to provide firms with more time to prepare and address the operational and cost challenges associated with central clearing.
Nate Wuerffel said he welcomed the extension, acknowledging that the initial timeline was aggressive. "We need this additional 12 months to get the work done," he said, emphasizing the need to thoroughly prepare for the transition.
Exponential Growth
In March 2025, FICC announced it was fully compliant with all SEC requirements, including final rules, enhanced access models, and the separation of house and customer activity. The exponential growth in volumes cleared by FICC was also highlighted, demonstrating the increasing adoption of central clearing.
"When the SEC's Treasury Clearing Rule was first proposed in September 2022, our average daily volume was $4.5 trillion per day,” Klimpel said. “By December 2023, it had grown to $7.2 trillion per day and on April 9 of this year, we achieved our all-time high of $11.4 trillion."
“Treasury clearing implementation is well underway at DTCC,” she said.
Enhancements & Expansion
Klimpel also discussed several upcoming service enhancements at FICC.
To address double margining issues for money market funds, FICC will introduce tri-party service enhancements later this year in collaboration with the Bank of New York. These enhancements will address double margining through the use of collateral instead of separate margin requirements.
Additionally, efforts are underway to expand end-user cross-margining capabilities with CME.
Klimpel explained, "We are actively engaged with our primary regulators to get the necessary approvals. The goal is to extend these capabilities to include not only house activity but also the underlying customers’ activities. Public filings are expected in the second half of 2025, with the hope of going live by the end of the year, pending regulatory approval.”
Learn more about how DTCC is strengthening the U.S. Treasury market.