European Regulation

Esma Chief Warns Securities Regulators on Monitoring Risk

Securities watchdogs have inadequate resources to cope with their new regulatory responsibility for monitoring systemic risk, the EU’s top markets regulator has warned. FT: Esma Chief Warns Securities Regulators on Monitoring Risk.

EMIR FX: ESMA Pours Murk into the Fog

The long-running saga of FX derivatives’ status under EMIR was not made appreciably clearer by comments from ESMA Chairman Steven Maijoor last week. DRS: EMIR FX: ESMA Pours Murk into the Fog.

EMIR Trade Reporting and Public Data: What Is the Point?

EMIR regulations have failed so far to produce anything useful in terms of public data. While the three main trade repositories are reporting, the data is very disappointing and has no real-word use. Tabb Forum: EMIR Trade Reporting and Public Data: What Is the Point?

Höhere Risiken durch EMIR

Führende europäische Energiekonzerne warnen vor teuren Auswirkungen der Marktinfrastrukturrichtlinie EMIR. Eigentlich dazu bestimmt, mehr Licht ins Dunkel der undurchsichtigen Derivativemärkte zu bringen, könnte der Schuss nach hinten losgehen und ihre Geschäfte riskanter machen, befürchten die Unternehmen. RiskNET: Höhere Risiken durch EMIR.

EMIR Risk Mitigation- FCA Hammer to Fall

A brief reminder that the FCA’s deadline for compliance with EMIR risk-mitigation regulations expires on 30th April 2014. DRS: EMIR Risk Mitigation- FCA Hammer to Fall.

MiFID 2 – A Bigger Bang

A bold new law will reshape Europe’s capital markets. Economist: MiFID 2 – A Bigger Bang.

ESMA Gets MiFID II\MiFIR Green Light

The European Parliament has published its formal request to ESMA, asking for technical advice on the delegated and implementing acts of MiFIR and MiFID II. DRS: ESMA Gets MiFID II\MiFIR Green Light.

Before You Head for the Beach

As the i’s are dotted and the t’s crossed in the MiFID II Level 1 text ahead of its June publication in the EU’s Official Journal, ESMA is already gearing up for Level 2. Finextra: Before You Head for the Beach.

ESMA Confirms MiFID Consultation Due in One Month

Proposed regulatory technical standards for MiFID II are due to be published in a weighty consultation due at the end of May, a spokesman for the European Securities and Markets Authority (ESMA) had told theTRADEnews.com. The Trade News: ESMA Confirms MiFID Consultation Due in One Month.

EU Financial Services Reform Gets Final Nod

On 24 April 2014, the EU Council published information notes regarding the outcome of the EU Parliament’s vote on 15 April 2014 on MiFID II, the Single Resolution Mechanism and the Bank Recovery and Resolution Directive. DRS: EU Financial Services Reform Gets Final Nod.

EU Nations Seeking Transaction Levy Remain Stuck on What to Tax

European Union nations that want a financial-transaction tax remain deadlocked on what trades they should include, as the clock runs down before next month’s European Parliament elections. Bloomberg: EU Nations Seeking Transaction Levy Remain Stuck on What to Tax.

‘Super Tuesday’: a New Wave to Hit your EU Operating Model

On Tuesday, 15 April the European Parliament approved several new reforms to manage banking sector risk and ensure that shareholders, not taxpayers, pick up the tab for the next crisis. RegTechFS: ‘Super Tuesday’: a New Wave to Hit your EU Operating Model.

EU Financial Transaction Tax Won't Come Before 2016 – Diplomats

(Reuters) – Selected euro zone countries will implement a planned tax on financial transactions in 2016 at the earliest, their finance ministers agreed on Monday according to diplomats, leaving unresolved the much-disputed design of the levy. Reuters: EU Financial Transaction Tax Won't Come Before 2016 – Diplomats.

EU Regulators to Focus on Asset Management

Sharon Bowles, chair of the committee on economic and monetary affairs in the European Parliament said the systemic risk from asset managers will be a heavy focus for regulators. Markets Media: EU Regulators to Focus on Asset Management.

Regulation Landscape Set for More Change

UK retail investors have been granted greater protection and transparency. FT Adviser: Regulation Landscape Set for More Change.

US Regulation

Top Clinton Aides Blew a Chance to Avert the Financial Crisis

The U.S. economy and the stock market were booming on April 21, 1998, when the heaviest hitters of the Clinton administration met to discuss a controversial topic: whether the government should regulate a profitable but risky corner of the financial markets. Treasury Secretary Robert Rubin, the former Goldman Sachs (GS) co-chairman, attended. So did his deputy, Larry Summers, and Alan Greenspan, chairman of the Federal Reserve. The meeting’s odd woman out was Brooksley Born, the little-known chairwoman of a little-known agency, the Commodity Futures Trading Commission (CFTC), who exhorted her colleagues to consider regulating privately traded derivatives such as swaps contracts. Bloomberg Businessweek: Top Clinton Aides Blew a Chance to Avert the Financial Crisis.

U.S. Senators Urge Fed to Ban Banks’ Commodity Plays

U.S. Sens. Sherrod Brown (D-OH) and Elizabeth Warren (D-MA) Wednesday urged the Federal Reserve to curb banks from owning commodities businesses, including energy commodities, to prevent them from potentially hurting global supply chains. CTRM Center: U.S. Senators Urge Fed to Ban Banks’ Commodity Plays.

CFTC MTF No Action- A Long and Complex Answer to a Question No-one is Asking Anymore

On the 9th April the CFTC “clarified” the confusion regarding substituted SEF compliance for MTFs. No-action Letter 14-46 supersedes and extends the 11th February 2014 relief from SEF-registration rules  that were due to take effect on 15 May 2014, affecting EU MTFs and SDs who wish to transact through them. DRS: CFTC MTF No Action- A Long and Complex Answer to a Question No-one is Asking Anymore.

As Easy As M-A-T

As the post-MAT [made available to trade] hits the two-month mark, SEF operators expect to see additional products ‘MAT-ted’, including packaged trades, for which the Commodity Futures Trading Commission has set a May 15 deadline. Markets Media: As Easy As M-A-T.

CFTC Launches Inquiry into Evasion of Swaps Rules

The U.S. swaps regulator plans to research whether U.S. banks' overseas trading activity is complying with its rules, a senior official said on Monday, as Wall Street adapts to new rules for the $690 trillion global market. Reuters: CFTC Launches Inquiry into Evasion of Swaps Rules.

CFTC Further Implements Trade Execution Mandate

Washington, DC — The Commodity Futures Trading Commission’s (CFTC or Commission) Divisions of Market Oversight (DMO) and Clearing and Risk (DCR) announced today further implementation of the trade execution requirement for certain interest rate and credit default swaps. CFTC Press Release: CFTC Further Implements Trade Execution Mandate.

Scott O'Malia, It's Your Fault

Swaps markets have fragmented, and the CFTC commissioner accepts regulation is to blame. Risk: Scott O'Malia, It's Your Fault.

To Segregate or Not- That’s Now the Question

Today marks the effective date for compliance with CFTC final rules on notification of IM segregation for SDs/MSPs. DRS: To Segregate or Not- That’s Now the Question.

International & Mixed Regulation

Swaps and Derivatives: Tougher Capital Rules Boost Traders’ Feelings of Security

Last month the International Swaps and Derivatives Association (Isda), a trade body, asked members and swaps users if markets were safer now than before the financial crisis. FT: Swaps and Derivatives: Tougher Capital Rules Boost Traders’ Feelings of Security.

ISDA AGM: What Does the Future Hold for the OTC Markets?

Regulation and how the derivatives industry is coming to terms with this new market order was the central theme of the recent ISDA AGM in Munich, says Jim Bennett, Sapient Global Markets. FOW: ISDA AGM: What Does the Future Hold for the OTC Markets?

Forget Dodd Frank, AIFMD, FATCA and MiFID: This is the Regulatory Threat that Matters

The closure on 7 April of the Financial Stability Board (FSB) and International Organisation of Securities Commissions (IOSCO) consultation on the methodologies required to identify non-bank, non-insurer global systemically important financial institutions (NBNI G-SIFIs) may not sound exciting. COO Connect: Forget Dodd Frank, AIFMD, FATCA and MiFID: This is the Regulatory Threat that Matters.

ISDA Publishes Negative Interest Protocol

On 12 May 2014, ISDA published the “ISDA 2014 Collateral Agreement Negative Interest Protocol” (the Protocol). The Protocol pretty much does what it says on the tin – creating a mechanism to allow adhering parties to amend collateral agreements such that, if the Interest Amount for an Interest Period is negative, the Pledgor/Transferor of cash collateral must transfer the absolute value of that Interest Amount to the Secured Party/Transferee. DRS: ISDA Publishes Negative Interest Protocol.