Summary
CME Group Inc. (CME) announced on November 7, 2013, the renewal of its 364-day multi-currency credit facility. This facility provides CME with a crucial $7 billion line of credit, which can be increased up to $10 billion under certain conditions, to ensure temporary liquidity. The credit facility is designed to support CME's operations in scenarios involving defaulting clearing members or disruptions in money transfer systems, leveraging clearing firm guaranty fund contributions and performance bond assets as collateral.
Key Highlights
- 1Renewal of a 364-day multi-currency credit facility.
- 2The credit facility provides a $7 billion line of credit.
- 3CME has the option to increase the credit line to $10 billion.
- 4The facility is intended to provide temporary liquidity.
- 5Potential use cases include covering obligations of defaulting clearing members.
- 6The credit facility is collateralized by clearing firm guaranty fund contributions and performance bond assets.
- 7The renewal underscores CME's proactive liquidity management and operational resilience.
Frequently Asked Questions
The credit facility is primarily intended to provide CME Group with temporary liquidity. This ensures the company can meet its obligations in critical situations, such as covering the outstanding obligations of any defaulting clearing member or addressing operational disruptions caused by issues with money transfer systems.
The current credit facility provides a line of credit totaling $7 billion. CME Group also has the option to seek an increase in this line of credit up to $10 billion, subject to the agreement of the participating banks.
The credit facility is collateralized by clearing firm guaranty fund contributions and performance bond assets that are held by CME.
The credit facility has a term of 364 days.