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Rates, CDS Notionals Both Up Year-on-Year

By Beth Shah
March 25, 2015, GlobalCapital

Both the overall interest rate notionals and trades counts that were reported to swap data repositories last week increased by 22% and 35%, respectively, from the same time last year, according to data from the International Swaps and Derivatives Association.

Overall reported credit default swap notionals and trade counts were also up compared to March 2014, but only by 1% and 5%, respectively.

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Comment: Regulators Must Remain Vigilant in Supervising Clearinghouses

By Mark Wetjen
March 18, 2015, Reuters

Last month the board of the International Organization of Securities Commissions (IOSCO) met in Seoul to discuss a number of agenda items, including safeguards for central counterparties, or CCPs.

IOSCO - as the name suggests - is the international forum and standard setter for market regulators such as the Commodity Futures Trading Commission (CFTC), upon which I serve, the Securities Exchange Commission, as well as comparable regulators around the globe.

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Rise of Alternative OTC Dispute Venues

March 18, 2015, International Financial Law Review

Counterparties in the region are increasingly resorting to alternative venues to resolve disputes over complex financial products. 

Traditionally litigation has been the preferred form of dispute resolution in international finance. For a long time, the default option in derivatives contracts -- even involving counterparties in Asia -- has been either the London or New York courts. That changed in September 2013 when the International Swaps and Derivatives Association (ISDA) published the 2013 ISDA Arbitration Guide. The 2013 Guide set out an overview of the key feaures of arbitration. 

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OTC Rates Trading Trends Shift Under New Regs

March 16, 2015, The Trade

Market participants traded more OTC interest rate derivatives in 2014, but in smaller sizes according to a review.

The International Swaps and Derivatives Association (ISDA) found that average daily notion volume fell from $588 billion in the first quarter of the year to $484.4 billion in the fourth quarter.

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ISDA Calls for Changes to Derivatives Transparency Rules

By James Rundle
March 5, 2015, Financial News

Derivative markets run the risk of a liquidity shortage if impending European regulations are not refined, a leading trade body has warned.

The Markets in Financial Instruments Directive II proposes widespread improvements to transparency, obliging prices and volumes for trades in multiple asset classes to be publicly reported, if the products are classified as liquid.

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Negative Interest Rates Test Technology at European Banks

By Christopher Whittall, Anna Molin, and Christopher Bjork
March 4, 2015, The Wall Street Journal

Widespread negative interest rates, once only a theoretical possibility, have become a real-life problem for Europe’s financial system.

From Sweden to Spain, banks, brokers and other financial firms are grappling with technical and legal glitches thrown up by negative rates, forcing them to redesign computer systems, tear up spreadsheets and redraft legal contracts.

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ESMA Urged to Change 1-Trade-Per-Day Liquidity Definition

By John Bakie
March 5, 2015, The Trade

The European Securities and Markets Authority (ESMA) is being urged to recalibrate its proposed liquidity thresholds for some classes of derivative, after its December consultation paper appeared to indicate products with as few as one trade per day would be considered liquid.

In a media briefing today, Scott O’Malia, CEO of the International Swaps and Derivatives Association (ISDA) and a former Commodity Futures Trading Commissioner said proposals in MiFID II risk applying a “liquid instrument” term too broadly, which will ultimately harm trading in many less liquid products.

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ISDA Calls for Reporting Harmony

By Helen Bartholomew
February 28, 2015, IFR

Incomplete and inconsistent data currently being reported in the US$691trn over-the-counter derivatives market mean that regulators still lack a true picture of risk in individual jurisdictions, ISDA has warned.

The industry body last week outlined a set of key principles and initiatives that it believes will improve regulatory transparency of derivatives activity and is calling for laws that prevent policymakers appropriately accessing and sharing data across borders to be amended or repealed.

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ISDA Calls for Standardized Trade Reporting

By Cian Burke
February 26, 2015, FOW

Trade body has called on global regulators to standardize reporting.

The International Swaps and Derivatives Association (ISDA) has called on global regulators to standardize reporting regimes to allow greater transparency in derivatives markets. 

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Malaysia Close to Becoming a Clean Netting Jurisdiction

By Viren Vaghela
February 16, 2015, Risk

Banks will save hundreds of millions of dollars in risk-weighted assets as netting is permitted and collateral becomes enforceable in Malaysia.

Malaysia is about to become a netting-friendly jurisdiction which means collateral will be enforceable in the event of default and payment will be calculated on a net basis rather than being grossed up for each individual transaction. This arrangement is a prerequisite for favourable capital treatment under Basel III – with dealers saying the upshot will be an increase in business.

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