According to “OMIClear Investment Policy”, approved by the Board of Directors, OMIClear may invest its cash resulting from:
- Own funds;
- Guarantees deposited by its Participants, through any legally accepted form of fiduciary transfer.
OMIClear investments are based on strict rules allowing the mitigation of risk faced by the CCP and its Participants.
- OMIClear ensures the complete segregation between OMIClear’s own funds and cash guarantees set up by its Participants.
- At least 95% are invested through highly secured arrangements such as:
1. Deposit with a central bank of the European System of Central Banks (ESCB);
2. Deposit guaranteed with a Qualified Credit Institution (QCI) - The eligibility of a QCI is assessed by means of OMIClear’s “Credit Risk Policy”, approved by the Board of Directors and OMIClear’s Risk Committee;
3. Repo transactions with a QCI.
- The guarantee of such arrangements is provided by means of financial pledges or fiduciary transfers of securities, which are:
1. Subject to the same haircuts and market evaluation as the ones required by OMIClear to its Participants;
2. Deposited in securities settlement system operator notified under Directive 98/26/CE or with an ESCB bank.
- Full availability of the funds to cover liquidity needs (maximum one clearing day).
- Cash deposits which are not performed through highly secured arrangements are limited to QCI and can represent a maximum of 5% of OMIClear’s own funds and of Participants’ cash collateral.
- Concentration limits are defined per QCI.
- OMIClear can only invest in securities using cash that comes from its own funds and up to 5% of the cash Guarantees deposited by its Participants..
- OMIClear only invests in the securities that are also eligible as Guarantees as defined in specific Instruction which have low market risk and credit risk, being the investment previously subject to the Board of Director’s approval.
- The securities invested:
1. May not be part of a portfolio with an average maturity of more than 2 (two) years;
2. Must be free of charges or encumbrances incurred by the seller;
3. Are deposited by OMIClear with a securities settlement system operator notified under Directive 98/26/CE, or with an ESCB bank.