Over-the-Counter Reform May Harm Asian Markets

Even though Asia has some of the world’s quickest growing economies, their over-the-counter derivative markets may struggle with the upcoming U.S. regulatory deadline. The regulatory overhaul comes about in response to the 2008 market meltdown. One of the major targets of the financial reforms that are to...

Mandatory Swaps Clearing, Says CFTC

The CFTC announced today that swap dealers, major swap participants, and private funds active in the swaps market, are required to begin clearing certain index credit default swaps (CDS) and interest rate swaps that they entered into on, or after March 11, 2013. In a press release, the CFTC stated that the...

Barnier Issues Letter to EU Lawmakers Concerning Swaps Rules

The European Union’s financial services chief, Michel Barnier, issued a letter asking EU Lawmakers to drop a threat that would block derivatives rules, stating the plan has the potential to harm the EU credibility. According to Barnier’s letter, obtained by Bloomberg News, delaying over-the counter...

ESMA Provides Confirmation, Relief for Fears of Front-Margin for Swaps

The European Securities and Markets Authority (ESMA) has said that a new regulatory regime will not impose swaps margin requirements retroactively. The prospect of changing margin costs for enduring trades came to be know “front-margining,” and a substantial amount of worry had developed in...

SEC’s Walter Sets Loose Agenda for 2013: Cross-Border Swaps are No. 1

New U.S. Securities and Exchange Commission head Elisse Walter set the stage for the commission’s upcoming regulatory year on Friday. Walters placed capital raising, market structure, and issues of extraterritoriality regarding cross-border swaps regulation at the top of the agenda. SEC on Cross-Border...

The Future of Derivatives Data: DTCC, CME and SDR’s

The future of derivatives data hangs in the balance as U.S. regulators deal with proposed Rule 1001, which would allow CME Group to report swaps data from its clients who have their swaps cleared with DTCC. The looming case between DTCC and CME had so far resorted to arguments about transparency. Now, DTCC...

Regulators in India, U.S. Loosen Grip on Credit Default Swaps (CDS)

Regulators in the U.S. and India now plan to ease up on the credit default swaps (CDS) market. CDS in India The Reserve Bank of India announced this week that it will allow credit default swaps (CDS) for unlisted rated corporate bonds. It already allows CDS for listed bonds. “In addition to listed...

FX Update: Will the European Union Exempt FX Swaps?

It is unclear whether the European Union will exempt FX swaps from clearing rules even though the U.S. Treasury did so last month. In November the U.S. Treasury exempted FX swaps, the second largest derivatives trading market, from certain stipulations of the Dodd-Frank Act. The Treasury cited high-levels of...

Swaps Report: ISDA Predicts Only 20% of Swaps Will Remain Uncleared

A report by the International Swaps and Derivatives Association (ISDA) predicts that swaps remaining outside of clearing will require traders to post $1.7 to $10.2 trillion in initial margin, after new rules go into effect next year. Margin is the collateral that traders use to back their positions; initial...

Pre-Trade Tech Providers Set for Competition in Rates, Credit, FX

MarkitServ and Traiana, two post-trade tech providers, are releasing comparable pre-trade technologies that is poised to alter the clearing and execution for FX and beyond. The utilities will provide pre-trade notification in real time for credit availability. A later version of Credit Centre, the technology...
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