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ISDA Looks to Overhaul Single Name CDS

By Joe Rennison
May 20, 2015, Financial Times

The financial industry is seeking to overhaul a vital but deteriorating part of the credit derivatives market by reducing the number of contracts available, hoping this will ameliorate trading conditions in the wider corporate bond market.

The International Swaps and Derivatives Association, the main industry trade body, has held two meetings in recent weeks where banks, hedge funds and asset managers discussed a crucial change to how the credit default swaps (CDS) market operates.

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CFTC Takes Aim At ISDAfix Manipulation with Barclays Case

By Michael Mackenzie, Joe Rennison and Philip Stafford 
May 20, 2015, Financial Times

Barclays has become the first bank to be fined in the long-running investigation into alleged manipulation of US interest rate swap contracts, through a global derivatives benchmark known as Isdafix.

On Wednesday, the US Commodity Futures Trading Commission fined Barclays $115m for attempting to manipulate the benchmark over a five-year period ending in 2012. At that time, the benchmark was owned by the International Swaps and Derivatives Association, an industry trade body.

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Clearing House Stand-Off to Causes Fragmentation, says ISDA Chief

May 13, 2015, The Trade

The chief executive of Wall Street’s derivatives trading body believes a failure to agree on clearing house equivalence and margin rules between European and US regulators could cause further fragmentation in the swaps market.

In an online blog from Scott O’Malia, CEO of the International Swaps and Derivatives Association (ISDA), said market participants will be forced to trade along geographic lines due to different margin requirements between the US and Europe. The result could mean higher costs and systemic risk.

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Mooted Clearing of Options on Credit Indices Raises Concern

By Joe Rennison
May 12, 2015, Financial Times

The chief executive of Wall Street’s derivatives trading body believes a failure to agree on clearing house equivalence and margin rules between European and US regulators could cause further fragmentation in the swaps market.

In an online blog from Scott O’Malia, CEO of the International Swaps and Derivatives Association (ISDA), said market participants will be forced to trade along geographic lines due to different margin requirements between the US and Europe. The result could mean higher costs and systemic risk.

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ISDA and Markit Team to Deliver EMIR Trade Tool

By Gabriel Suprise
May 11, 2015, GlobalCapital

The International Swaps and Derivatives Association and Markit have partnered to launch a trade classification tool for EMIR, which will allow investors to determine clearing obligations.

The two firms teamed up to offer the EMIR Clearing Classification Tool, a trade classifier that allows investors trading interest rate swaps to determine their clearing obligations under the European Market Infrastructure Regulation mandate as determined by the European Securities and Markets Authority. 

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ISDA Launches Trade Identifier Service

By Joanna Wright
May 7, 2015, The Trade

A lack of standards is hindering transparency in derivatives markets, says industry association.

The International Swaps and Derivatives Association (ISDA) today (May 7) announced the launch of UTIPrefix.org, a service that enables counterparties to obtain a unique trade identifier (UTI) prefix in order to create UTIs for the reporting of derivatives trades.

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Single-Name CDS Seeks Revival

By David Wigan
May 2, 2015, IFR

Credit market participants have ramped up pressure for a change in rules governing single-name CDS, amid concern that declining appetite for the asset class is threatening its viability.

Bankers and investors said urgent action was required to revive the fortunes of the single name market, including a move to biannual rolls, from the current quarterly formulation, and a swift migration to central clearing.

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Swiss Peg Carnage Highlights E-Trade Limitations

By Helen Bartholomew
May 2, 2015, IFR

A widespread shift to electronic trading may not be the panacea for liquidity, transparency and efficiency in over-the-counter swaps markets that some regulators are hoping for, industry participants have warned, highlighting carnage resulting from the removal of the Swiss franc peg in January.

The Swiss National Bank’s January 15 decision to scrap a three-year-old 1.20 cap on the euro-franc exchange rate triggered a 25% strengthening in the Swiss currency in a matter of hours and put the world’s most electronically traded market into disarray as screens went blank for up to nine minutes.

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CFTC Commissioners Get Behind SEF Reforms

By Jon Watkins
April 28, 2015, The Trade

US regulatory Commissioners have backed new plans for swap execution facilities aiming to breathe life into the electronic trading platforms.

The trading venues at the centre of swaps reforms in the US were launched a year ago but have not had the uptake many expected, especially from a hesitant buy-side.

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ESMA Adds Second-Level Reporting Validation

By Helen Bartholomew
April 27, 2015, IFR

The European Securities & Markets Authority has introduced an additional layer of validation requirements for registered trade repositories to ensure the completeness of data submitted on swap transactions under the European Markets Infrastructure Regulation.

As part of a newly published question and answer paper relating to implementation of EMIR, Europe’s key swaps market regulator confirmed a new two-step validation process to ensure reporting is performed according to the new regime and in line with rules set out in the technical standards.

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