LCH Makes US Head John Horkan COO Amid Post-Brexit Rumblings

The clearinghouse operator, which is majority-owned by the London Stock Exchange Group (LSEG), announced the appointment on October 27. Horkan will also continue in his role as head of North America.

This is the latest change at the top for LCH, which announced that Daniel Maguire, the former COO for LCH Group, would be taking over from CEO Suneel Bakshi on October 18.

The appointments also come at a politically sensitive time for the group. On June 13, the European Commission announced that, in extreme cases, it may consider forcing systemically important clearinghouses that handle euro-denominated trades to relocate to the Eurozone for closer supervision.

The move was widely seen as being targeted specifically at London-headquartered LCH, which handles 90 percent of trading in euro-denominated interest-rate derivatives. It was also seen at the time as one of the first salvos in negotiations over the UK’s departure from the European Union in 2019. The provision does not apply to US-based entities, which are covered under a separate agreement between the European Commission and the US Commodity Futures Trading Commission.

On October 25, speaking before a House of Lords committee, Maguire intimated that this strategy may, in fact, backfire on European authorities and that LCH might instead consider moving to the US, given its own and its parent, LSEG’s, substantial operations in New York.

“When you start to consider location, the answer isn’t necessarily relocation to Europe. It could be a relocation going the other way, to the States,” Maguire said.

LCH declined to comment when asked by WatersTechnology whether the decision to appoint of Horkan, who will be remaining in New York, as COO, was tied to Maguire’s testimony, but sources close to the matter say the developments are unrelated.