KUALA LUMPUR: Bursa Malaysia Derivatives Bhd's wholly-owned subsidiary, Bursa Malaysia Derivatives Clearing Bhd, an approved clearing house for the Malaysian derivatives market under the Capital Market Services Act has been recognised as a Third-Country Central Counterparty (TC-CCP) by the European Securities and Markets Authority (ESMA).
In a statement today, the exchange said TC-CCP recognition was granted to Bursa Malaysia Derivatives Clearing on Nov 7, under the European Market Infrastructure Regulation (EMIR).
"The exchange will now have greater access to the European investment communities while European counterparties will find it easier and more cost-effective to do business with Bursa Malaysia," it said.
Bursa Malaysia Derivatives acting director Saleem Kader Bakas said the recognition confirms Bursa Malaysia has been aligned with international standards, which would create new opportunities with European clearing institutions.
"We are the third exchange in Asean to be accorded this recognition, which is a significant milestone for Bursa Malaysia," he said.
Under EMIR requirements, only recognised TC-CCPs will be able to provide clearing services to members or trading venues established in the European Union.
"Furthermore, being recognised means that market participants from Europe are subjected to lower capital requirements or charges under the Basel III framework introduced by the Basel Committee on Banking Supervision, which enables European members to manage their counterparty risk efficiently," the exchange added.