NYSE sets "full service" clearing house for London NYSE Euronext has pledged to make building up a "full service" clearing house in London a priority as the US-exchange operator sought to draw a line under its failed tie-up with Deutsche Börse. Duncan Niederauer, NYSE chief executive, said the group's portfolio of clearing businesses would be "a key focus" this year, as G20 regulations designed to expand use of clearing in the vast over-the-counter (OTC) derivatives markets move towards completion. "Our immediate focus in 2012 will be Europe ... and the build out of Liffe Clear [in London] and of new OTC clearing solutions," Mr Niederauer told analysts on a fourth-quarter earnings conference call. Developing the post-trade business would be "critical for us in 2012." His comments come as rivals have been expanding into clearing, a crucial post-trade process that helps guarantee that securities and derivatives trades are completed even if one party defaults. Clearing, especially in London, has become a priority for many of the world's exchanges as they see a business opportunity in offering clearing services as more activity is forced to be cleared through post-2008 crisis regulations. London is already home to clearing houses recently set up by NYSE rivals IntercontinentalExchange and CME Group, both of which are using the UK capital as a beachhead to push into Europe. The London Stock Exchange is in exclusive talks with LCH.Clearnet, an Anglo-French clearer based in London, about taking a controlling stake. NYSE Euronext has a fledgling clearing house in London known as NYSE Liffe Clear but it shares some of the clearing of the Liffe futures exchange's derivatives with LCH. Clearnet. The aim is to convert NYSE Liffe Clear into a "full-service" clearer that would not only handle Liffe's futures contracts but also offer clearing of OTC derivatives. Part of Liffe Clear's expansion would require altering the relationship with LCH. At present, Liffe derivatives are processed through Liffe Clear, but the treasury and risk management services - the heart of what a clearing house does - are outsourced to LCH. "We want to get all the revenues, and then have a platform to launch new products like over-the-counter interest rate and credit [default] swaps," said Michael Geltzeiler, chief financial officer of NYSE Euronext, in an interview. He said the group would lay out specific details at an analyst meeting in early April. NYSE said its Liffe US futures market, launched last year to compete against CME Group, was expected to become profitable in 2013 after the roll-out of new products this year. NYSE also was looking at "the possible addition of new partners" at a US clearing house that clears Liffe US products and is run jointly with Depository Trust & Clearing Corp, the dominant securities post-trade group in the country. Mr Niederauer said that NYSE was still "in a position to grow through strategic M&A," pointing out that it had cut its net debt to earnings before interest, debt, tax and amortisation ratio to 1.6 times - the lowest level since before the NYSE group bought Euronext, the European network of stock exchanges, in 2007. The group's net income in the fourth quarter fell from $135m to $110m after charges of $46m for merger expenses and exit costs, mostly related to the Deutsche Börse deal. I don't regret what we tried to do for a second. It's onward and upward from here," Mr Niederauer said. Pressure on NYSE also came from weak trading volumes, especially in Europe. Net revenues from derivatives fell 1 per cent from a year ago to $186m. However, turnover in its technology business, which sells trading software and direct connections to the exchange, grew 16 per cent over last year to $127m.