Some "purists" seem to have taken offense at our earlier suggestion that standalone clearinghouses (DTCC) could be impaired in some quasi-principal risk taking form. We respectfully disagree and present some perspectives from the conversion of the ICE Trust into the central clearing counterparty for CDS transactions (which will be lucky to ever see even clear even a fraction of the CDS transactions that the DTCC does... which could very well be the Fed's thinking).
"Clearing is a form of extending credit, one of the main functions of banking institutions. A clearing agent substitutes its credit for that of its customers. A clearing agent is liable to a clearinghouse for performance on all submitted contracts, and assumes, with respect to the exchange, clearinghouse, and counterparties, the risk of default. The clearing function is akin to two other traditional bank credit functions, providing bankers’ acceptances and letters of credit. The credit function provided by a national bank in its clearing capacity is part of the business of banking, because a principal business of a bank is to extend credit." - OCC Interpretive Letter