The G20 leaders summit in 2009 kick-started a crucial yet complex process towards central clearing for derivatives. Implementing EMIR, defining consistent rules for CCPs and introducing the clearing obligation are all major tasks. The next logical step is to tackle any risk associated with the new structure – and with the European Commission due to […]
Post-trade technology provider Traiana has made a bid for banks and buy-side firms to use its central counterparty (CCP) connectivity service to clear non-deliverable forwards (NDFs) through LCH.Clearnet’s ForexClear, after announcing the addition of ForexClear to Harmony CCP Connect.
Asian central counterparties (CCPs) looking to meet the September 15 deadline in applying for European Securities and Markets Authority (Esma) recognition will, for the most part, have to apply without knowing if their jurisdiction is deemed equivalent to that set out in the European Market Infrastructure Regulation (Emir).
It could be dangerous to require a central counterparty (CCP) to set out in advance the steps it would take to recover from a severe loss, Eurex has warned – a stance at odds with emerging international policy – because the recovery plans may not work in all conditions.
Mandatory clearing of over-the-counter derivatives could jeopardise policy-makers’ hopes of a no-bailout financial system, according to Gary Dunn, senior manager for regulatory and risk analytics at HSBC.
Buy-side firms have reacted angrily to temporary portfolio margining provisions rushed out by the Securities and Exchange Commission (SEC) late on Friday as the clock counted down towards the start of mandatory clearing in the US.
Simon Garwood, Investment Services at Fiserv and Andy Mellor, Risk and Compliance, say that those considering a response to OTC regulations must also address operational risk issues.
Central counterparties (CCPs) should make full details of their risk and margin models publicly available, and any attempt to withhold information on the basis it is proprietary is wrong and unjustifiable, according to a senior Bank of England official.
The possibility that mandatory central clearing of over-the-counter derivatives, coupled with margin requirements for uncleared trades, could create a drain on the supply of eligible collateral has been overestimated and should not be a cause for panic, a senior official at the Bank of England has said.
The failure to establish either a single global central counterparty (CCP) or a viable approach to interoperability means the move to central clearing has simply increased the number of institutions in the global financial system that are too big to fail, according to Manmohan Singh, senior economist at the International Monetary Fund.
South Korea is set to miss the deadline to start clearing derivatives through a central counterparty (CCP) by the start of 2013 because of delays in passing new legislation to formalise central clearing through parliament.
Liam Huxley, vice president of Product Strategy at Advent Software, has discussed the introduction of centralized clearing and how a company such as his is talking to market participants, particularly the clearing houses and regulators, to develop solutions.