NYSE Euronext and the Depository Trust & Clearing Corporation (DTCC) have finalized their New York Portfolio Clearing (NYPC) joint venture for clearing U.S. fixed income cash and derivatives.

A draft of the NYPC application for status as a Derivative Clearing Organization with the CFTC and draft amendments to the rules of DTCC's Fixed Income Clearing Corporation (FICC) are expected to be circulated in the coming weeks.

Pending regulatory approvals, NYPC is anticipating operations to being in the second quarter of 2010.

In a statement, Thomas Callahan, Chief Executive Officer of NYSE Liffe U.S., said, "NYSE Euronext is thrilled to finalize this groundbreaking agreement with DTCC. NYPC is a story of innovation. Because of the strength of our Global Derivatives franchise, NYSE Euronext is singularly positioned to partner with DTCC on this important initiative due to our proprietary technology, strong capital base, broad market connectivity, and our industry-leading futures clearing expertise."

NYPC will margin cash and derivatives markets in a single pot as opposed to through existing cross-margining agreements. It aims to improve operational and capital efficiency by bringing together cash positions and their natural derivatives hedge.

Murray Pozmanter, Managing Director of Fixed Income Clearance and Settlement at DTCC, added, "Through our open access model, DTCC intends to support competition in the U.S. futures markets. By extending the unique NYPC risk methodology to multiple markets and products, we will offer our unique capital efficiencies to a wide range of customers and market participants."