Northern Trust announced today it is implementing direct clearing of cash and repurchase agreement (repo) trades for fixed income securities through the Canadian Derivatives Clearing Corporation (CDCC). Northern Trust is the first global custodian to utilize the CDCC, clearing trades on behalf of the Healthcare of Ontario Pension Plan (HOOPP).
HOOPP and three other large buy-side organizations were invited to apply to become Limited Clearing Members (LCMs) by the Bank of Canada in order to participate in an expansion of direct clearing announced in 2017 by the CDCC, Canada's national central clearing counterparty (CCP) for exchange-traded derivative products, certain over-the-counter products and repos. The expansion of CDCC's direct-clearing model to include LCMs extends the range of benefits associated with CCP clearing, including capital, margin and collateral efficiencies.
“In partnership with HOOPP, we are pleased to implement this enhanced clearing capability for Canadian securities," said Arti Sharma, President and CEO of Northern Trust Canada. “As Canada’s capital markets work to make settlement more efficient and resilient, Northern Trust is committed to providing the support and consultation our clients need to benefit from these positive industry developments.”
“Partnering with Northern Trust strengthens our investment ability since many of our investment strategies rely on repo financing to make them work. This new setup will make HOOPP a more attractive counterparty for the banks and should ensure liquidity from this source during severe market downturns, which is good for our members,” says HOOPP President and CEO Jim Keohane.
About the Healthcare of Ontario Pension Plan
Created in 1960, HOOPP is a multi-employer contributory defined benefit plan for Ontario’s hospital and community-based healthcare sector with 548 participating employers. HOOPP’s membership includes nurses, medical technicians, food services staff and housekeeping staff, and many other people who work hard to provide Ontario with valued healthcare services. In total, HOOPP has more than 339,000 active, deferred and retired members.
As a defined benefit plan, HOOPP provides eligible members with a retirement income based on a formula that takes into account a member's earnings history and length of service in the Plan. HOOPP is governed by a Board of Trustees with representation from the Ontario Hospital Association (OHA) and four unions: the Ontario Nurses' Association (ONA), the Canadian Union of Public Employees (CUPE), the Ontario Public Service Employees' Union (OPSEU), and the Service Employees International Union (SEIU). The unique governance model provides representation from both management and workers in support of the long-term interests of the Plan.
Northern Trust – Canada
A global leader in institutional financial services, our exclusive focus in Canada is on providing asset servicing and asset management solutions to institutional asset owners, investment managers, foundations and endowments. We combine regional insights with a global breadth of capabilities to support your needs.
Northern Trust Canada has been successfully servicing clients for over 30 years – including pension funds, investment managers, insurance companies, government agencies and corporations. Our rich heritage and intricate understanding of the region allows us to provide unique insights and strategic perspectives to our clients. Visit northerntrust.com/canada to learn more.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has offices in the United States in 19 states and Washington, D.C., and 23 international locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of March 31, 2018, Northern Trust had assets under custody/administration of US$10.8 trillion, and assets under management of US$1.2 trillion. For more than 125 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit northerntrust.com or follow us on Twitter @NorthernTrust.
Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Global legal and regulatory information can be found at https://www.northerntrust.com/disclosures.