KUALA LUMPUR (June 10): London Metal Exchange (LME) clearing members have been advised that new margin collateral haircuts have been set.

In a notice on Thursday (June 9), LME head of liquidity and collateral risk management Barry Gethin said the changes will be made effective at close of business June 15, 2022 and will be reflected in the collateral valuation on the morning of June 16, 2022.

According to LME, acceptable collateral provided by clearing members is subject to a reduction in value (haircut) for margin cover purposes depending on the form of collateral provided.

LME Clear will determine the criteria for acceptable collateral and collateral haircuts in line with regulatory requirements and its own risk policy.