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LCH meaning in Business ?

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Answer: What is London Clearing House mean?

LCH (originally London Clearing House) is a British clearing house group that serves major international exchanges, as well as a range of OTC markets. The LCH Group consists of two subsidiaries: LCH Ltd (based in London) and LCH SA (based in Paris). Based on 2012 figures, LCH cleared approximately 50% of the global interest rate swap market, and was the second largest clearer of bonds and repos in the world, providing services across 13 government debt markets. In addition, LCH clears a broad range of asset classes including: commodities, securities, exchange traded derivatives, credit default swaps, energy contracts, freight derivatives, interest rate swaps, foreign exchange and Euro and Sterling denominated bonds and repos.

LCH's members comprise many of the major financial groups including almost all of the major investment banks, broker dealers and international commodity houses. LCH, being a clearing house, sits in the middle of a trade assuming the counterparty risk involved when two parties trade guaranteeing the settlement of the trade. To mitigate the risks involved it imposes certain minimum requirements on its members and collects initial and variation margin (or collateral) from them for trades that have been executed.

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