Providing certainty and stability in an uncertain world

October 1, 2026

In the third installment of our ‘State of the Markets’ interview series, LSEG’s Marcus Robinson, Head of LCH CDSClear and Head of LCH DigitalAssetClear, and Nick Rustad, Group Head of LCH SwapClear and LCH Listed Rates, discuss the crucial role clearing plays in helping to create certainty and maintain market stability.

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Hello and welcome to this edition of State of the Marketswhere we hear from senior leaders from LCH on the big issues shaping markets right now.I'm Jon Cronin and I'm delighted to be joined here in LSEG's London studioby Marcus Robinson, Head of CDSClear and DigitalAssetClearand Nick Rustad, Group Head of LCH SwapClear and Listed Rates.Nick, Marcus, great to have you both in the studio.Thank you. Thank you Jon.Well we've got a lot to chat through but in this episodewe're going to take a look at the market backdropconsider the challenges and priorities clients are dealing withand discuss the role clearing can play in helping markets function with greater certainty,resilience and efficiency.So let me come to you both, but before we get into thatlet's just think a little bit about your roles first and just try tounderstand what your focus isso talk to me about that focus and the perspective that it gives youon what's happening in today's markets.Marcus, perhaps you can start?Thank you Jon. I'll start by providing a bit of context to my perspective.So I joined LCH back in January of 2009,so post the global financial crisis and really I've been very fortunateto be involved in what evolved in this clearing revolutionespecially in OTC markets.I've been very much involved in the design, the development of OTC clearing from aproduct service perspective but also from a global expansion perspective as wellso that’s given me a fantastic insight in terms of how this space has really evolved over the last few years.Obviously a lot of OTC clearing was really regulatory drivenbut I think what we've seen is that clearing goes now far beyondwhat is mandated to be cleared, so if you look at what we've done with SwapClear,we’re now clearing beyond the mandated currencies to do 28 currencies, inflation swaps on creditwe’re now just not clearing indices we're clearing single names as well.So we're starting to see centralised clearingcreating that confidence and market efficiencies that's nowstarting to bring more into clearing.If I get back to the original question in terms of what are we seeing todayI think we're continuing to see this market evolution andI suppose what's driving that market evolution, what are we hearing back from our customers,we’re hearing, obviously, that they want us to clear more and so continually engage with us to clear more products,extend into new asset classes, which we've just done with digital asset clearinggetting into into new markets as well, but also continuing to evolve our tools and our services tooand then as well as all of that, there's the markets then evolving in terms of transitioning into that digital ecosystemwhich is, I suppose, a new area and frontier that we're going to be focussed on.Ok, so plenty on your plate there to consider Marcus.How about you Nick?Marcus talks about being part of the clearing revolution, that evolution as well, where do you sit in this?So Marcus obviously has been here 17 years or so and I feel a relative baby coming in justover 12 months ago but prior to that I spent my time on the sell side within the clearing businessso I was formerly a client of LCH and now delighted to be here and help tonavigate my various parts of the business through the next few years.Marcus covered a lot of what he's focussed on and it's no different in how we think about SwapClear.There's really two parts to my role.One is effectively being the custodian of SwapClear, a fantastic business whichthe team here has built over many years and the time frames with Marcus outlined earlierand making sure that we maintain our market share and maintain the go to place to clear interest rate swapsis fundamental to what I do,but we've also got exciting new developments as well in other areas.So we're looking to launch and have launched a listed rate service, which iscontinuing to gain market share and expanding our product offering within that interest rates section.So there's two roles for me, really, that constantly looking after and maintaining what is afantastic business and then looking to expand and evolve what we do in other areas of the section.Ok, so it's good to get a picture of both of your roles, but let's look at the bigger picturewhich is obviously why we're here.It's already been a busy and a challenging yearand uncertain year from where you sit now, how would you describe the current state of the markets?What are the the main pressures and challenges that you're seeing, Nick?I think what you say is completely true and we almost start every year wondering howvolatile is it going to be compared to previous years and somehow it’s surprisingly upsideat the moment and I think that's front and centre of client minds,the geopolitical situation is less stable than it potentially was before, but again, we can look backthrough to 2016 with Brexit and numerous geopolitical events over that last decadewhich has driven market activity and market volumes and then it's incumbent upon us to make sure we canrespond to that and make sure that we build the resiliency into our system, that we are thatstable port in a storm that clients and members can rely upon, so that when that uncertainty is there in marketsand that uncertainty leads to volatility, that we can be there and providing the sevices we doin a resilient and consistent manner and I think that's really whereclients want us to focus during those times of stress that we don't do anything different or we don’t makeit worse and I think that's fundamental to how we think about risk managingour clearing houses.So managing uncertainty and being a certain prospect within that field?Yeah, definitely. I think in times of market volatilityI think it puts a lot more focus on the clearing house around stability and resiliency.The way that we think about that is obviously the consequences of us not making margin calls on timeor sending reports out late has a knock on disruption further down the chain and that justcreates more noise and more uncertainty.So we are very focussed and we're continually focussed on continuing to invest in our infrastructure, cyber resiliency,operational risk are front and centre of again, what we're generally focussed on to make sure thatwe can continue to operate not just in times of crisis, but during normal business as usual as well.If you look at what we've seen over the last 6-12 months,lots of market volatility, lots of volume, I think from our perspective and themarket structure perspective, infrastructure and the clearing banks perspective, the marketsthe markets held up very well and if you look at that compared to the amount of activitythat we’re seeing now relative to what we were seeing in 2008, 2009with volumes of 4 to 5 times higher from where they are beforebut we've operated without any significant outages or issues at all.I like to think about the way that LCH performs more visablyby not being visible during times of stress.So the fact that we're not during times of market volatilitywe're not in the front and centre of the news meansthat we're doing the job that we're supposed to do.How does all that sit within the broader regulatory environment?From a regulatory perspectiveI think regulation is shaping less than before especially in OTC markets.I think we've been through a significant amount of regulatory change with bringing in mandatory clearingI think we've been through a significant amount of regulatory change with bringing in mandatory clearingand I think that's now pretty embedded in the market ecosystem.I think what we're now focussed on and I think what the regulators are now focussed onis how can we bring more into clearing, more other products, more other asset classes into clearingso that they can benefit from the trust and the efficiencies that clearing brings in as well.So I think the regulators aren't necessarily mandating anymore, necessarily lookingat mandating anymore they're looking at the market to naturally come into clearing.That’s an approach we've taken with FX, with our ForexClear service, where obviouslythat's not a mandated product, but we're starting to see more flow coming into FXand to some degree with what we're seeing with fixed income in Europewhere there's no mandate, but we're seeing, naturally,market participants come in to clearing and I think the benefits that they are seeing isby using tried, tested, standardised market infrastructure that creates operationalefficiencies, capital efficiencies and economic efficiencies for the use of banks.Interesting perspective on the regulator there.Let's just think more broadly around the all important market participants.Nick, let me come to you on this, what does the role ofclearing look like in practice for them in this kind of environment?I think it’s really simple.I think clearing offers certainty in what is an uncertain world, currently.I think Marcus has done a great job there of outlining the experience and the innovation of the industry.I think clearing is a good idea and I don't think anybody thinks that's up for debate.When we talk about how do we make markets more efficient or more resilient, or what regulation is good andwhat's bad regulation, nobody debates clearing as a concept anymore and I think what that's meantis that market participants have built clearing.So the need to get that infrastructure in place is over.What clients are looking for now is efficiency, how can they do it as effectively as possible.Whether that's how quickly can we process trades, how efficient can we make our margin calls,what can we potentially portfolio margin against one another so that we're notusing excess capital or excess capital is not being put to good use to support the economyto be able to make loans to consumers, to homeowners, to companies, to build the economyall of those things now where we are focussed and what we are focussed on within SwapClear in effect istrying to make that as efficient and as seamless as possible.Marcus alluded earlier to the ideathat we don't want to be noticed during periods of market volatility and that's really exactlyhow we can exemplify that as much as possible.That certainty of what we're going to dowhen we're going to do it, in the way we said we're going to do it, is really what people value.That’s an interesting point though because the challenge for you both is that clearing houses areoften thought about, talked about, during times of market pressure so let's broaden this out a little bit.When we talk about certainty, for clients what does it mean in day-to-day terms.So I think you can think about, I use the words certainty and predictability interchangeably and I thinkwhat do I mean about that? I think from a predictability perspective, I think what ourcustomers and our clients and our members really want is predictability of margins and processesin terms of what is expected of them, especially in times of crisis and especially during default.So there's a degree of transparency that we need to be able to provideto them to make sure that there are no surprises, nobody likes surprises, so everybody's really gotto understand what role they have to play during certain scenarios, which is why we have fire drills.We regularly road test our default management processes through fire drills, we spend huge amounts of time...On fire drills, just testing the process?Testing, testing, testing, the process of default management, auction processes, bidding, etc.which is why we spend huge amounts of timeengaging with our customers, with our clients around how theprocesses evolved, but also when it comes down to designing new services, launching new products,that consultation and that feedback loop, working with our customer communityit's super important to what we need to be able to present that level of trust and confidence.We are rightly judged in times of stress in terms of how we performWe are rightly judged in times of stress in terms of how we performWe are rightly judged in times of stress in terms of how we performbut the reality is we're interacting with our members and our clientsevery single day, talking to them about optimising margin, talking to them about their reportsbeing as helpful to them as we can do and that interaction, that daily dialogue, sometimes goesunder the radar because of this focus of us in highly volatile, highly stressful times.Well let's just expand on that a little bit more as well Nick.You came to LCH from outside the business,banking background as we touched on already, so what stood out for you the mostabout the way it works, LCH works and the broader market too?What didn't surprise me, in some ways,is the sophistication of the risk management we have here.I think that's taken for grantedso I wasn't really surprised with how diligent and the level of expertise we have within the organisation.That was a nice tick and a reassuring tick in terms of what we have.I think that what's probably surprised me is the level of interaction, is the level of innovation displayedwith our members and our clients on an almost daily basis.We used to have a slogan thatLCH was the market partner and I think that really sums up where we are.We are talking to our clients, we are trying to provide the solutionsin my specific realm of expertise, but also in Post Trade Solutionsand wider across the LSEG group.It's a continual theme, but we are there towork with our partners, work with our clients and members and not to compete with them.That connection is very real, then?Very real and there isn't that friction or frustration you may see in other businesses.We are here to support them at all times.Marcus, how much does local market understanding matter in a global business like LCH?I think for the global markets in which we operate, I think understanding localmarkets is hugely important for what we do, especially when we're operating acrossdifferent time zones with different regulatory regimes, different market structures sometimesbut also different client needs as well and I think that's been critical to LCH'ssuccess over the last few years as we've grown our services more broadly.And I think that's been a huge differentiator for us over the last few years.It's not just about complying with regulations, it's understanding what ourregulatory obligations are, what our local obligations are to the local community.The local engagement with regulators and with customers has been super important andthat's where we spend a lot of time engaging with all of the different market participants toreally understand what are their specific needs to engage with our services on the clearing side.Perhaps give us an example of that in practice then,we’re thinking locally, pick a zone in the world where that comes out?So I’ve been very fortunate as well to have the opportunity to build and set up LCH's franchise in Asia Pacificand that involved working with a lot of the regulators in Australia, in Japan, in Hong Kong, in Singaporewe were the first foreign CCP to be licensed in all of those jurisdictionsso I spent a lot of time engaging and really collaborating and building thosepartnerships with a lot of the regulators.But I think building the trust and confidence notjust with the regulators but with the local markets is also super important as wellso putting people on the ground was fundamental to that, so I relocated to Asia to be on the groundto really be there in person and engage, have that more personal interaction with alot of our stakeholders there,but understanding their specific needs and I thinkthe path that we followed in Asia was very similar to the paththat we followed when we were expanding into the US and in Europe as well.We're very conscious to create local working groups to give the opportunity forthe local participants to have a voice and have a say on the types of market intricaciesthat they want to see within some of the services that we operate.So we can appear more local even though we are obviously operating much more global service.Well, let's widen that lens a little bit from the local and thinkabout the global perspective, particularly when it comes to fragmentation.You hear a lot about market fragmentationbut are clients are actually looking for that or they are they looking for something elseand where does LCH fit into that, Nick?Yeah, I think that's true.The way I think about it is we want to offer global scale and local expertise and I think thatlocal expertise comes in with that fragmentation of regulation and I think that's where we need tomake sure that everybody's aligned with what we're trying to achieve, right?We want competition.Good regulation drives good competition, which benefits end consumers,whether that be through better products, cheaper products, wherever that takes us, that, I think, we all agree on.What people don't want as a result of that is fragmentation and I think what we saw on thebanking side and what I see here now is people don't want ten pools of liquidity, they don't wantto have to pick and choose at various times to work out what's most efficientthey want that central pool of liquidity, they want that central pool of clearingbut one which is underpinned by good regulationwhich has driven us and kept us on our toes at driving better products and better pricing.Okay, well listen, look, final question to you bothI'm interested in getting a message from you, if you had one message that you could share with clientsor market participants that they could take away from this discussion when they're thinking about clearingand the role of clearing today, what would it be? Marcus, let me come to you first.So I think a lot of what we've been speaking about today is the role that clearing housesprovide in terms of providing that degree of certainty and that trust and that confidence.It's not just about the confidence in terms of risk managementit’s increasingly now providing greater value and benefits beyond just trade innovationand I think that's becoming increasingly apparent, so it's not just about risk mitigation, it's nowabout how can we provide greater efficiencies from an operational perspective, capital balance sheet, RWA, etc.So I think that central role that we play on the clearing side also createsopportunities for us to provide the similar sorts of efficiencies in other uncleared markets.Especially in OTC markets as well and obviously, that's led us to start to think about how wecan provide similar clearing-like services through our Post Trade Solutions businesses.So our SwapAgent, TradeAgent services are the first foray into providing that integratedcleared and uncleared market infrastructure. We have optimisation and margin and collateral services too, that again, provide that common theme of providingefficiencies and standardisation that supports greater value to our customers.So I think the role of clearing is still going to be fundamental, but I think there areother collaborative services that we can look at that are more complementary to what we havein the clearing today in the uncleared world.Okay, thank you and Nick, your message, what would that be?Help us to help you. It's as simple as that.I think we can only respond to what our clients require from us and what they need from us.We don't have an intellectual monopoly on the clearing industry.I think we have certain standards and certain risk thresholds wewant to adhere to and we are required to adhere tobut that innovation is driven by our end users needs.So talk to us, educate us, help us solve some of these problemsand together we'll end up in the right place.Okay, well unfortunately we are out of time now,it’s been a fascinating conversation.Nick, Marcus, thank you both very much indeed.Thank you.You've been watching State of the Markets.To find out more about LCH, visit our website and social channels.Thanks for watching and we look forward to seeing you next time, but for now goodbye.Thanks for watching and we look forward to seeing you next time, but for now goodbye.Hello and welcome to this edition of State of the Marketswhere we hear from senior leaders from LCH on the big issues shaping markets right now.I'm Jon Cronin and I'm delighted to be joined here in LSEG's London studioby Marcus Robinson, Head of CDSClear and DigitalAssetClearand Nick Rustad, Group Head of LCH SwapClear and Listed Rates.Nick, Marcus, great to have you both in the studio.Thank you. Thank you Jon.Well we've got a lot to chat through but in this episodewe're going to take a look at the market backdropconsider the challenges and priorities clients are dealing withand discuss the role clearing can play in helping markets function with greater certainty,resilience and efficiency.So let me come to you both, but before we get into thatlet's just think a little bit about your roles first and just try tounderstand what your focus isso talk to me about that focus and the perspective that it gives youon what's happening in today's markets.Marcus, perhaps you can start?Thank you Jon. I'll start by providing a bit of context to my perspective.So I joined LCH back in January of 2009,so post the global financial crisis and really I've been very fortunateto be involved in what evolved in this clearing revolutionespecially in OTC markets.I've been very much involved in the design, the development of OTC clearing from aproduct service perspective but also from a global expansion perspective as wellso that’s given me a fantastic insight in terms of how this space has really evolved over the last few years.Obviously a lot of OTC clearing was really regulatory drivenbut I think what we've seen is that clearing goes now far beyondwhat is mandated to be cleared, so if you look at what we've done with SwapClear,we’re now clearing beyond the mandated currencies to do 28 currencies, inflation swaps on creditwe’re now just not clearing indices we're clearing single names as well.So we're starting to see centralised clearingcreating that confidence and market efficiencies that's nowstarting to bring more into clearing.If I get back to the original question in terms of what are we seeing todayI think we're continuing to see this market evolution andI suppose what's driving that market evolution, what are we hearing back from our customers,we’re hearing, obviously, that they want us to clear more and so continually engage with us to clear more products,extend into new asset classes, which we've just done with digital asset clearinggetting into into new markets as well, but also continuing to evolve our tools and our services tooand then as well as all of that, there's the markets then evolving in terms of transitioning into that digital ecosystemwhich is, I suppose, a new area and frontier that we're going to be focussed on.Ok, so plenty on your plate there to consider Marcus.How about you Nick?Marcus talks about being part of the clearing revolution, that evolution as well, where do you sit in this?So Marcus obviously has been here 17 years or so and I feel a relative baby coming in justover 12 months ago but prior to that I spent my time on the sell side within the clearing businessso I was formerly a client of LCH and now delighted to be here and help tonavigate my various parts of the business through the next few years.Marcus covered a lot of what he's focussed on and it's no different in how we think about SwapClear.There's really two parts to my role.One is effectively being the custodian of SwapClear, a fantastic business whichthe team here has built over many years and the time frames with Marcus outlined earlierand making sure that we maintain our market share and maintain the go to place to clear interest rate swapsis fundamental to what I do,but we've also got exciting new developments as well in other areas.So we're looking to launch and have launched a listed rate service, which iscontinuing to gain market share and expanding our product offering within that interest rates section.So there's two roles for me, really, that constantly looking after and maintaining what is afantastic business and then looking to expand and evolve what we do in other areas of the section.Ok, so it's good to get a picture of both of your roles, but let's look at the bigger picturewhich is obviously why we're here.It's already been a busy and a challenging yearand uncertain year from where you sit now, how would you describe the current state of the markets?What are the the main pressures and challenges that you're seeing, Nick?I think what you say is completely true and we almost start every year wondering howvolatile is it going to be compared to previous years and somehow it’s surprisingly upsideat the moment and I think that's front and centre of client minds,the geopolitical situation is less stable than it potentially was before, but again, we can look backthrough to 2016 with Brexit and numerous geopolitical events over that last decadewhich has driven market activity and market volumes and then it's incumbent upon us to make sure we canrespond to that and make sure that we build the resiliency into our system, that we are thatstable port in a storm that clients and members can rely upon, so that when that uncertainty is there in marketsand that uncertainty leads to volatility, that we can be there and providing the sevices we doin a resilient and consistent manner and I think that's really whereclients want us to focus during those times of stress that we don't do anything different or we don’t makeit worse and I think that's fundamental to how we think about risk managingour clearing houses.So managing uncertainty and being a certain prospect within that field?Yeah, definitely. I think in times of market volatilityI think it puts a lot more focus on the clearing house around stability and resiliency.The way that we think about that is obviously the consequences of us not making margin calls on timeor sending reports out late has a knock on disruption further down the chain and that justcreates more noise and more uncertainty.So we are very focussed and we're continually focussed on continuing to invest in our infrastructure, cyber resiliency,operational risk are front and centre of again, what we're generally focussed on to make sure thatwe can continue to operate not just in times of crisis, but during normal business as usual as well.If you look at what we've seen over the last 6-12 months,lots of market volatility, lots of volume, I think from our perspective and themarket structure perspective, infrastructure and the clearing banks perspective, the marketsthe markets held up very well and if you look at that compared to the amount of activitythat we’re seeing now relative to what we were seeing in 2008, 2009with volumes of 4 to 5 times higher from where they are beforebut we've operated without any significant outages or issues at all.I like to think about the way that LCH performs more visablyby not being visible during times of stress.So the fact that we're not during times of market volatilitywe're not in the front and centre of the news meansthat we're doing the job that we're supposed to do.How does all that sit within the broader regulatory environment?From a regulatory perspectiveI think regulation is shaping less than before especially in OTC markets.I think we've been through a significant amount of regulatory change with bringing in mandatory clearingI think we've been through a significant amount of regulatory change with bringing in mandatory clearingand I think that's now pretty embedded in the market ecosystem.I think what we're now focussed on and I think what the regulators are now focussed onis how can we bring more into clearing, more other products, more other asset classes into clearingso that they can benefit from the trust and the efficiencies that clearing brings in as well.So I think the regulators aren't necessarily mandating anymore, necessarily lookingat mandating anymore they're looking at the market to naturally come into clearing.That’s an approach we've taken with FX, with our ForexClear service, where obviouslythat's not a mandated product, but we're starting to see more flow coming into FXand to some degree with what we're seeing with fixed income in Europewhere there's no mandate, but we're seeing, naturally,market participants come in to clearing and I think the benefits that they are seeing isby using tried, tested, standardised market infrastructure that creates operationalefficiencies, capital efficiencies and economic efficiencies for the use of banks.Interesting perspective on the regulator there.Let's just think more broadly around the all important market participants.Nick, let me come to you on this, what does the role ofclearing look like in practice for them in this kind of environment?I think it’s really simple.I think clearing offers certainty in what is an uncertain world, currently.I think Marcus has done a great job there of outlining the experience and the innovation of the industry.I think clearing is a good idea and I don't think anybody thinks that's up for debate.When we talk about how do we make markets more efficient or more resilient, or what regulation is good andwhat's bad regulation, nobody debates clearing as a concept anymore and I think what that's meantis that market participants have built clearing.So the need to get that infrastructure in place is over.What clients are looking for now is efficiency, how can they do it as effectively as possible.Whether that's how quickly can we process trades, how efficient can we make our margin calls,what can we potentially portfolio margin against one another so that we're notusing excess capital or excess capital is not being put to good use to support the economyto be able to make loans to consumers, to homeowners, to companies, to build the economyall of those things now where we are focussed and what we are focussed on within SwapClear in effect istrying to make that as efficient and as seamless as possible.Marcus alluded earlier to the ideathat we don't want to be noticed during periods of market volatility and that's really exactlyhow we can exemplify that as much as possible.That certainty of what we're going to dowhen we're going to do it, in the way we said we're going to do it, is really what people value.That’s an interesting point though because the challenge for you both is that clearing houses areoften thought about, talked about, during times of market pressure so let's broaden this out a little bit.When we talk about certainty, for clients what does it mean in day-to-day terms.So I think you can think about, I use the words certainty and predictability interchangeably and I thinkwhat do I mean about that? I think from a predictability perspective, I think what ourcustomers and our clients and our members really want is predictability of margins and processesin terms of what is expected of them, especially in times of crisis and especially during default.So there's a degree of transparency that we need to be able to provideto them to make sure that there are no surprises, nobody likes surprises, so everybody's really gotto understand what role they have to play during certain scenarios, which is why we have fire drills.We regularly road test our default management processes through fire drills, we spend huge amounts of time...On fire drills, just testing the process?Testing, testing, testing, the process of default management, auction processes, bidding, etc.which is why we spend huge amounts of timeengaging with our customers, with our clients around how theprocesses evolved, but also when it comes down to designing new services, launching new products,that consultation and that feedback loop, working with our customer communityit's super important to what we need to be able to present that level of trust and confidence.We are rightly judged in times of stress in terms of how we performWe are rightly judged in times of stress in terms of how we performWe are rightly judged in times of stress in terms of how we performbut the reality is we're interacting with our members and our clientsevery single day, talking to them about optimising margin, talking to them about their reportsbeing as helpful to them as we can do and that interaction, that daily dialogue, sometimes goesunder the radar because of this focus of us in highly volatile, highly stressful times.Well let's just expand on that a little bit more as well Nick.You came to LCH from outside the business,banking background as we touched on already, so what stood out for you the mostabout the way it works, LCH works and the broader market too?What didn't surprise me, in some ways,is the sophistication of the risk management we have here.I think that's taken for grantedso I wasn't really surprised with how diligent and the level of expertise we have within the organisation.That was a nice tick and a reassuring tick in terms of what we have.I think that what's probably surprised me is the level of interaction, is the level of innovation displayedwith our members and our clients on an almost daily basis.We used to have a slogan thatLCH was the market partner and I think that really sums up where we are.We are talking to our clients, we are trying to provide the solutionsin my specific realm of expertise, but also in Post Trade Solutionsand wider across the LSEG group.It's a continual theme, but we are there towork with our partners, work with our clients and members and not to compete with them.That connection is very real, then?Very real and there isn't that friction or frustration you may see in other businesses.We are here to support them at all times.Marcus, how much does local market understanding matter in a global business like LCH?I think for the global markets in which we operate, I think understanding localmarkets is hugely important for what we do, especially when we're operating acrossdifferent time zones with different regulatory regimes, different market structures sometimesbut also different client needs as well and I think that's been critical to LCH'ssuccess over the last few years as we've grown our services more broadly.And I think that's been a huge differentiator for us over the last few years.It's not just about complying with regulations, it's understanding what ourregulatory obligations are, what our local obligations are to the local community.The local engagement with regulators and with customers has been super important andthat's where we spend a lot of time engaging with all of the different market participants toreally understand what are their specific needs to engage with our services on the clearing side.Perhaps give us an example of that in practice then,we’re thinking locally, pick a zone in the world where that comes out?So I’ve been very fortunate as well to have the opportunity to build and set up LCH's franchise in Asia Pacificand that involved working with a lot of the regulators in Australia, in Japan, in Hong Kong, in Singaporewe were the first foreign CCP to be licensed in all of those jurisdictionsso I spent a lot of time engaging and really collaborating and building thosepartnerships with a lot of the regulators.But I think building the trust and confidence notjust with the regulators but with the local markets is also super important as wellso putting people on the ground was fundamental to that, so I relocated to Asia to be on the groundto really be there in person and engage, have that more personal interaction with alot of our stakeholders there,but understanding their specific needs and I thinkthe path that we followed in Asia was very similar to the paththat we followed when we were expanding into the US and in Europe as well.We're very conscious to create local working groups to give the opportunity forthe local participants to have a voice and have a say on the types of market intricaciesthat they want to see within some of the services that we operate.So we can appear more local even though we are obviously operating much more global service.Well, let's widen that lens a little bit from the local and thinkabout the global perspective, particularly when it comes to fragmentation.You hear a lot about market fragmentationbut are clients are actually looking for that or they are they looking for something elseand where does LCH fit into that, Nick?Yeah, I think that's true.The way I think about it is we want to offer global scale and local expertise and I think thatlocal expertise comes in with that fragmentation of regulation and I think that's where we need tomake sure that everybody's aligned with what we're trying to achieve, right?We want competition.Good regulation drives good competition, which benefits end consumers,whether that be through better products, cheaper products, wherever that takes us, that, I think, we all agree on.What people don't want as a result of that is fragmentation and I think what we saw on thebanking side and what I see here now is people don't want ten pools of liquidity, they don't wantto have to pick and choose at various times to work out what's most efficientthey want that central pool of liquidity, they want that central pool of clearingbut one which is underpinned by good regulationwhich has driven us and kept us on our toes at driving better products and better pricing.Okay, well listen, look, final question to you bothI'm interested in getting a message from you, if you had one message that you could share with clientsor market participants that they could take away from this discussion when they're thinking about clearingand the role of clearing today, what would it be? Marcus, let me come to you first.So I think a lot of what we've been speaking about today is the role that clearing housesprovide in terms of providing that degree of certainty and that trust and that confidence.It's not just about the confidence in terms of risk managementit’s increasingly now providing greater value and benefits beyond just trade innovationand I think that's becoming increasingly apparent, so it's not just about risk mitigation, it's nowabout how can we provide greater efficiencies from an operational perspective, capital balance sheet, RWA, etc.So I think that central role that we play on the clearing side also createsopportunities for us to provide the similar sorts of efficiencies in other uncleared markets.Especially in OTC markets as well and obviously, that's led us to start to think about how wecan provide similar clearing-like services through our Post Trade Solutions businesses.So our SwapAgent, TradeAgent services are the first foray into providing that integratedcleared and uncleared market infrastructure. We have optimisation and margin and collateral services too, that again, provide that common theme of providingefficiencies and standardisation that supports greater value to our customers.So I think the role of clearing is still going to be fundamental, but I think there areother collaborative services that we can look at that are more complementary to what we havein the clearing today in the uncleared world.Okay, thank you and Nick, your message, what would that be?Help us to help you. It's as simple as that.I think we can only respond to what our clients require from us and what they need from us.We don't have an intellectual monopoly on the clearing industry.I think we have certain standards and certain risk thresholds wewant to adhere to and we are required to adhere tobut that innovation is driven by our end users needs.So talk to us, educate us, help us solve some of these problemsand together we'll end up in the right place.Okay, well unfortunately we are out of time now,it’s been a fascinating conversation.Nick, Marcus, thank you both very much indeed.Thank you.You've been watching State of the Markets.To find out more about LCH, visit our website and social channels.Thanks for watching and we look forward to seeing you next time, but for now goodbye.Thanks for watching and we look forward to seeing you next time, but for now goodbye.

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