BoE gives 3 years to clearing houses for inspection framework
Bank of England has provided a three-and-a-half-year time frame for three domestic clearing houses to work out an inspection framework amenable to UK norms, giving British banks an advantage over their European counterparts when it comes to handling investment flows to India.
The European markets regulator in October 2022 de-recognised six domestic clearing houses, creating hurdles for trading and management of billions of dollars' worth of international flows for the continent's banks operating in India.
British authorities, which had initially followed suit, have, however, been much quicker at resolving issues pertaining to treatment of Indian clearing houses.
«Currently a non-UK CCP (central counterparty) that enters the run-off regime from the TRR (Temporary Recognition Regime) is taken to be recognised for a period of up to three and a half years, determined by the Bank of England, from the day on which the CCP ceases to be taken to be recognised under the TRR,» read a Bank of England document dated September 28.
The three Indian clearing houses listed out by the UK central bank are the India International Clearing Corporation Limited, the NSE Clearing Limited, and the NSE IFSC Clearing Corporation Limited.
The three clearing houses, which had entered the run-off regime from the UK's Temporary Recognition on April 30, 2023, have been given time till October 30, 2026, which is the date of exit, the document read.
«CCPs in the run-off regime are unable to enter (or re-enter) the TRR, but can apply for recognition under the standard process if they wish to provide clearing services and activities in the UK once their time in the run-off regime ends,» the Bank of England said.
The India International Clearing
