The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, announced its Fixed Income Clearing Corporation’s (FICC’s) Government Securities Division (GSD) has reached a new milestone, successfully processing USD$8.8 trillion in daily activity on July 31. The increase represents a jump of over 30% year-over-year.

This significant and continued growth can be attributed to rising volumes and activity in the U.S. Treasury market as well as the continued expansion of FICC’s Sponsored Service, which saw a new peak volume of $1.4 trillion on August 15, growth of 78% year-over-year, including FICC’s Sponsored GC Service, which by itself has seen growth of 94% year-over-year. There are now over 2,400 sponsored members across 50 approved jurisdictions participating in FICC clearing.

“FICC’s wide range of access models makes it possible for a greater percentage of the market to take advantage of the many benefits of central clearing. One of those models – our Sponsored Service, has become an integral part of the U.S. repo market, offering Sponsoring Members the ability to sponsor their clients into FICC membership to maximize capital efficiency and offer more funding capacity to the market, increasing overall liquidity,” stated Laura Klimpel, Managing Director, Head of DTCC’s Fixed Income and Financing Solutions. “Our new milestones in daily activity demonstrate FICC’s robust ability to support rising volumes and volatility and a smooth implementation of the SEC’s expanded U.S. Treasury Clearing rules.”

FICC’s Sponsored Service allows sponsoring members to facilitate the submission of their client’s trading activity in eligible securities for novation to FICC. Sponsoring members act as operational and administrative agents on behalf of their clients and guarantee their clients’ activity to FICC, delivering numerous benefits to participants, including opportunities to reduce counterparty risk, obtain balance sheet and capital relief and increase their transaction capacity.

Specifically, FICC’s Sponsored Service generated an aggregate average of approximately $500bn daily in balance sheet savings across the industry in July 2024, peaking on July 31 at approximately $616bn of aggregate balance sheet savings across the industry.

Added Klimpel, “FICC is continually evolving our approach to meet the needs of a broader and more diverse market and support our clients as market structure evolves. As we continue to support increased volumes alongside a much larger member community, FICC will remain a driving force for innovation while ensuring fair and open access for all.”

Source: DTCC