OTCDerivNet was founded in October 2000 by Bank of America, Barclays, Citibank/ Schroder Salomon Smith Barney, Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, Merrill Lynch and Société Générale. It is a limited liability company owned by its bank partners.
Its purpose is to work with LCH.Clearnet in the development of a secure, efficient and cost-effective post-trade dated environment for OTC derivatives with a view to extending the existing range of clearable OTC derivatives transactions and promote broad market participation.
On October 8, 2008 many members of OTCDerivNet worked with LCH.Clearnet in the successful wind down of Lehman Brothers Special Financing Inc.'s over-the-counter (OTC) interest rate swap positions. Lehman's interest rate swap portfolio comprised 66,390 trades across 5 major currencies. The unwind of the book involved first hedging the counterparty risk of the contracts, then auctioning the swaps to members of SwapClear.
The total notional value of the portfolio was $9 trillion, encompassing a total of 66,390 trades across 5 major currencies.