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BME Clearing Fund

BME CLEARING FUND

If there is still a shortfall after applying all of the defaulting clearing member resources, the following resources will be used until the loss is covered for each Contract Group:

1)       The BME CLEARING fund (part of its Equity) for each Contract Group ("skin in the game");

2)       Contributions to the Default Fund by non-defaulting Members in respect of each Contract Group, and replenishment of contributions to the Default Fund; and

 3)       The rest of BME CLEARING's Equity, except the mínimum regulatory capital requirements.

Under no circumstances is use made of the fund contributed by BME CLEARING or the Default Fund contributions corresponding to the Contract Group in which the defaulting Member did not have a position or in which the closing balance on the position of the defaulting Member was in credit.

In its General Circular Fund provided by BME CLEARING, the CCP prescribes the proportion of its specific Equity to be allocated to each Contract Group in the event of a default. These amounts must be disclosed in the BME CLEARING financial statements separately from the rest of the CCP's Equity.

For each Contract Group such amounts are set as the greatest of the minimum contributions to the Default Fund to be posted by Clearing Members:

 

 
Contract Group BME CLEARING contribution to the Default Fund
Financial Derivatives €2,5 million
Energy €0.5 million
Fixed-income Securities €1 million
Swaps €0,5 million
Equity

€1 million 

 

BME CLEARING assesses the sufficiency of the “skin in the game” on a weekly and a monthly basis. The minimum “skin in the game” required for BME CLEARING under the frame of EMIR regulation is currently euro 1.875 million, less than the 5 million actually set by BME CLEARING .

The proportion of BME CLEARING fund assigned for every contract group fulfills what is established in article 35.3 of Delegated Regulations (EU) 153/2013.

 

 

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