State Street has worked with the Japan Securities Clearing Corporation (JSCC) to assist the clearing house in adding USD cash to the eligible collaterals in its interest rate swap clearing service.
USD cash collateral posted by clearing participants and customers will be managed on a daily basis through the sponsored repo transactions, the structure of which was jointly developed by State Street.
“State Street Trust and Banking Co., Ltd. in Japan will be the trustee of the US dollar collateral deposited by the clearing participants,” State Street said in a statement.
“The US dollar collateral will be invested in our sponsored repo transaction which meets US Treasury repo clearing requirement scheduled to be introduced by the US Securities and Exchange Commission (SEC) in June 2026.”
JSCC President and chief executive Konuma Yasuyuki added: “An addition of USD cash to eligible collaterals in IRS Clearing Service is a very big milestone for JSCC providing clearing services to clearing participants and their customers active globally.
“Amid rising calls for CCPs’ safe custody and efficient management of collaterals globally, we are confident that State Street’s USD cash collateral management service will realise great value for our users in Japan and overseas.”