SEFs: A Brief History of Time (One day to go)
WE'RE NEARLY THERE
The October 2nd SEF date is nearly upon us. It appears the world of SEFs are going live with only a couple CFTC reliefs being granted for trade reporting (no relief for IRS and CDS). The pace at which new utilities were born and approved by the CFTC seems unprecedented. So besides my usual update, I thought it would be good to step back and look at the progress of SEFs over the past month. I would ideally like to do a time-lapse video for the registration process, however I only have 4 data-points to work with (my 4 blogs), dating back to the end of August. So please find below a brief history of the past month and the quite impressive progress of applications and authorizations. To view this article with complete html tables, please click SEFs: A Brief History of Time
Bloomberg was the first one in the door, approved by the end of July. A total of 12 SEFs had filed with the CFTC.
The Tradeweb applications were approved over a full month after Bloomberg. 3 more SEFs put in applications.
A total of 9 SEFs were now approved, and yet another 3 SEFs lodged their filings.
With one day to go, 17 SEFs have their applications temporarily authorized. Only CME and a new entrant (LatAm SEF) remain unapproved.
|#||Registered Name||AKA||First Reg||Approval||Status||IRD||EQD||CRD||FXD||CMD|
|2||DW SEF||Tradeweb / Dealerweb||8-Jul||6-Sep||Temp||✔||CDX|
|3||TW SEF||Tradeweb / Dealerweb||8-Jul||6-Sep||Temp||✔||CDX|
|6||GFI Swaps Exchange||GFI||19-Jul||13-Sep||Temp||✔||✔||✔||✔||✔|
|11||ICE Swap Trade||ICE||2-Aug||20-Sep||Temp||✔|
|13||360 Trading Networks||360T||29-Aug||23-Sep||Temp||✔|
|14||ICAP SEF (US)||ICAP||30-Aug||27-Sep||Temp||✔||✔||✔||✔||✔|
|15||BGC Derivative Markets||BGC||4-Sep||19-Sep||Temp||✔||✔||CDX||✔||✔|
|17||Reuters SEF||Thomson Reuters / FXall||9-Sep||27-Sep||Temp||✔|
|19||LatAm SEF||LatAm SEF, LLC ??||25-Sep||Pending||??||??||??||??||??|
READ THE PRESS
As I have mentioned before in my blog, the CFTC official filings website often lags the news reports and press releases on industry filings. In case you are keeping score at home, it may be helpful to also monitor the CFTC press releases, as this is where I was able to confirm the news of ICAP and Reuters being registered.
Which brings me to the last entrant, LatAm SEF, LLC. I saw their name mentioned (but not explained) in a couple news reports claiming that only 2 SEFs are not yet approved. Their name did not ring a bell so I head to the CFTC website, where there are no associated documents or press releases related to their filing. I managed to find public records stating that they incorporated in Delaware on 11-Sep-2013. However that is all I can find. Google is unable to provide anything further. I am keen to learn more about LatAm SEF. I would be grateful if any readers would let me know in the comments section who this SEF is, what they are offering, which DCOs they intend to use, and any other related information about them. I want to offer a reward to the first person to yield information, ahead of any CFTC public documentation I can find available. [This is a reward from Todd at ClarusFT, not OTC Space I have to point out ;-)] The first person to give such information will win a one month free subscription of the Clarus SDRView Professional service.
BOAT FIRST SAILING
I am not sure who is left to be added to the list. I've read some press on FX Week about a couple FX Options platforms struggling with the particular circumstances surrounding FX, but I have to think there will be some more entrants in the weeks to come.
SO WHAT HAPPENS NEXT?
By many accounts, October 2 should turn out to be a snoozefest. The Made Available to Trade (MAT) designations are not due to come about until late Q4 at the absolute earliest, and as Kevin McPartland points out in his excellent post, doing so during the holiday season would seem a bit daft. I think the SEFs have enough to work out, both on the technical/integration aspects of their platforms as well as client onboarding, to think we're going to see anything exciting happen any time soon.
MY PARTING THOUGHT
Come October 2nd, I wonder if there will be anyone out there who will both (a) trade a swap on a SEF and (b) buy some Obamacare online?
Todd Skarecky, ClarusFT