TriOptima expands its triReduce compression catalogue with its first inflation swap compression cycle
28 January 2016
London/ New York – 28 January, 2016 TriOptima, an award-winning post trade infrastructure provider, announces today that 18 banks participated in the first triReduce inflation swap compression cycle terminating $98.5 billion notional in inflation index swaps for the European Union: EUR- Excluding Tobacco-Non-revised Consumer Price Index.
Inflation swaps tend to be long dated with compounding coupons generating large final cash payments, eliminating them reduces capital costs and enhances the leverage ratio, key goals of participating firms. TriOptima plans to execute triReduce British sterling (GBP) and US dollar (USD) inflation swap cycles, and will continue to run euro cycles with additional indices including the French FRC- Excluding Tobacco Non-Revised Consumer Price Index.
Long-dated inflation swap compression also appeals to TriOptima’s insurance company clients and their pension fund affiliates who currently use triReduce to compress interest rate swaps and who are affected by the new capital requirements imposed by the European Solvency II regimes.
“triReduce is always looking to enhance the services we offer to our customers, who continue to look for ways to reduce their balance sheet outstanding notional assets, and their capital costs,” said Peter Weibel, CEO of triReduce. “The addition of inflation swap compression demonstrates TriOptima’s ongoing innovation and creativity in tackling these more difficult transaction types, which include cross currency swaps and FX forwards, and in delivering an efficient and effective solution.”
TriOptima is the award-winning provider of post trade risk management services and infrastructure for OTC derivatives. Focused on reducing costs, eliminating operational and credit risk, improving counterparty exposure management, and reducing systemic risk, TriOptima offers a range of services: triReduce to reduce swap inventory and counterparty risk; triResolve to reconcile OTC derivative portfolios, manage disputes, validate repository data, and deliver an automated margin management solution; triBalance to manage cleared and bilateral counterparty risk; and triCalculate to measure and analyze counterparty risk.
TriOptima, an ICAP Group company, maintains offices in London, New York, Singapore, Stockholm, and Tokyo.