LCH (clearing house)

LCH Group

Company type	Private
Industry	Financial
Founded	1888; 136 years ago (1888)
Headquarters	London, England, UK
Products	Clearing house
Owner	London Stock Exchange Group (82.61%)
Website	www.lch.com

LCH (originally London Clearing House) is a financial market infrastructure company headquartered in London that provides clearing services to major international exchanges and to a range of OTC markets. The LCH Group includes two main entities: LCH Limited based in London and LCH SA based in Paris (formally Banque Centrale de Compensation SA, also known from 1999 to 2003 as Clearnet then until 2016 as LCH.Clearnet).^[1]

As of 2012^[update], LCH cleared approximately 50% of the global interest rate swap market,^[2] and was the second largest clearer of bonds and repos in the world, providing services across 13 government debt markets. In addition, LCH clears a broad range of asset classes including: commodities, securities, exchange traded derivatives, credit default swaps, energy contracts, freight derivatives, interest rate swaps, foreign exchange and Euro and Sterling denominated bonds and repos.

LCH's members comprise many of the major global financial institutions including almost all of the major investment banks, broker dealers and international commodity houses. LCH, being a clearing house, sits in the middle of a trade – assuming the counterparty risk involved when two parties trade and guaranteeing the settlement of the trade. To mitigate the risks involved it imposes certain minimum requirements on its members and collects initial and variation margin (or collateral) from them for trades that have been executed.