Compression is a vital tool in portfolio and capital management and international regulators have encouraged financial counterparties to consider using a compression service for non-centrally cleared OTC derivatives where available. Recognizing this, CLS collaborated with TriOptima to launch the triReduce CLS Forward FX Compression Service for FX forwards and swaps – a first of its kind in the FX market. The service helps to reduce operational risk and counterparty exposure and credit risk while improving leverage ratios and capital efficiency.

Since launching in October 2015, the service has cut more than USD112 billon in notional exposure for major dealers and the number of participating banks has increased, from an initial six to 14.

Alan Marquard, Chief Strategy and Development Officer at CLS, comments: "The FX compression service is in its initial growth phase.  As with any new service, there is a growth curve and we are firmly on it."

Peter Weibel, chief executive of TriOptima's multilateral compression service, triReduce, added: "TriOptima has a huge amount of experience in compression, as we have been in the business since 2003. Our strong infrastructure and robust legal framework are key to the success of the service."