A new patent covering the risk monitoring of multiple cleared CCP accounts may conflict with CCPs and other FinTech vendors from providing similar functions.
The ISDA AGM generated a wave of content last week which we've assembled into one handy place. Most of the material is focussed on margin for non-cleared products given the changes due in 2019.
Notionals in IRD have increased since January, some from OIS which has a larger gross notional than IRS. The uncleared margin rules have boosted FX Clear, and the exchange rate from EUR to USD has appreciated increasing the values. SGX appears to be out of FX clearing, notional dropping to zero, the biggest swing is HKEX who quadrupled their IRD notional.
The team here at The OTC Space are pleased to announce the availability of the downloadable PDF edition of Rocket 10 (in the attachments section below). Formatted in landscape to fit your computer or portable device screen, this edition contains inside information on what's happening in the industry. The PDF is attached below, and contains a great set of articles from previous and new authors.
Back when CCPs had to achieve reauthorisation under EMIR, their segregation offerings were a subject of much discussion and jargon. One key offering that was floated was the idea that your assets are held in an account over which you have joint control with the CCP, rather than held in an account for the CCP solely. The idea being that should the CCP default or be unable to service your requests to access your assets, you would have the possibility of moving assets out of your cover account.
On November 28th, 2016, the European Commission (EC) has published a proposal for a framework for the recovery and resolution of central counterparties and amending Regulations (EU) No 1095/2010, (EU) No 648/2012, and (EU) 2015/2365l1. This regulation is based on the work at the international level of the Financial Stability Board (“FSB”), the Basel Committee, Committee on Payments and infrastructures (CPMI) and International Organization of Securities Commissions (IOSCO). FSB published in August 2016 a discussion note on “Essential Aspects of CCP Resolution Planning” and jointly with the Basel Committee, CPMI and IOSCO, a progress report on the work plan to enhance the resilience, recovery planning and resolvability of CCPs2.
The jump of $150bn at ForexClear is believed to be from the introduction of margining for FX products, a sudden enthusiam to clear them. Shanghai CCP are doing well with OTC rate swaps having added $306bn of notional. Both JSCC and LCH actively use compression methods to eliminate notional hence the drops above. All units in millions of USD, so 1000 below means 1 billion of USD.