Nasdaq Europe to expand IRS clearing
Exchange technically ready to launch in coming months
Nasdaq targets users of euro IRS in the Nordics

LONDON, Jan 9 Reuters Nasdaq Europe has said it will expand derivatives clearing to include euro interest rate swaps IRS in the coming months, in the latest move by European Union market operators to pull business from London following Brexit.

Even before Britain left the EU in 2020, London had long irked Brussels with its dominance of clearing in IRS, contracts widely used by companies to hedge against adverse moves in borrowing costs.

Clearing is a critical part of financial markets39; plumbing, ensuring a transaction is completed even if one side goes bust.

London39;s dominance in clearing has helped it remain a major global financial centre by building up a deep pool of liquidity. Britain is trying to make its financial sector more globally competitive, after it was largely severed from the EU due to Brexit.

An EU law now being finalised will require banks in the bloc to have an active account at EUbased clearers for euro denominated IRS transactions, to reduce reliance on the London Stock Exchange Group LSEG, and to give EU regulators direct oversight of transactions linked to the bloc.

EU permission for banks in the bloc to continue using London for clearing derivatives is also due to expire in June 2025, piling further pressure to shift business across the Channel.

Nasdaq Clearing has begun talking to clients about…