LIFFE PLANS NEW CLEARING ARRANGEMENT WITH LCH.CLEARNET

Posted October 31, 2008

NEW YORK – LIFFE Administration & Management, the derivatives unit of NYSE Euronext, will take over its own clearing activities for its London market starting in the first quarter of 2009, outsourcing certain clearing functions to LCH.Clearnet Ltd. under new arrangements to be known as LiffeClear.

“LiffeClear creates a new clearing solution that better suits LIFFE in today’s market environment,” says Hugh Freedberg, Group Executive Vice President and Head of Global Derivatives at NYSE Euronext. “For NYSE Euronext, LiffeClear will enable competition against LIFFE’s vertically-integrated international peers on a more level playing field. For LCH.Clearnet, it means no disruption to its default backing arrangements and reaffirms its long-term relationship with LIFFE. Together, NYSE Euronext and LCH.Clearnet have created new, efficient and cost-effective clearing arrangements that will benefit members and provide a strong basis for future innovation.”

Under LiffeClear, LIFFE will become central counterparty to its own contracts, outsourcing clearing guarantee arrangements and related risk functions to LCH.Clearnet, which will remain responsible for defaulting member positions, applying LCH.Clearnet regulation and resources to the resolution of such a default.

Clearing members will only see de minimis operational changes as a result of the new arrangement. NYSE Euronext will make a one-time €260 million ($330.8 million) payment to LCH.Clearnet to terminate its current clearing arrangements there.