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Not All SEFs Are Equal

December 16, 2014, Markets Media

Comparing volumes at swap execution facilities is tricky because reported volumes can vary greatly depending on the type of SEF, the time of year, and the types of swaps being executed.

One significant change over the last few months is that some SEFs have seen great increases in usage of compression, which are a way for end users to execute large packages of risk neutral transactions in bulk.

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Post-Trade Headwinds Affect OTC Markets

December 10, 2014, Markets Media

The ongoing transformation of the OTC industry from a bilaterally traded and cleared model to an exchange-traded and centrally cleared model is fraught with operational challenges.

“There’s a lot of work in connectivity in building out SEFs (Swap Execution Facilities), and not just to CCPs,” or central counterparties, said Henry Ann, head of rates at GFI Swaps Exchange.

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CFTC Commissioner Calls for Foreign SEF Regime

November 20, 2014, The Trade

A top regulator at the US derivatives watchdog has called for the establishment of a foreign regime for the execution and clearing of off-exchange derivatives to mitigate the global market from fragmenting.

Mark Wetjen, a commissioner at the Commodity Futures Trading Commission (CFTC), became the latest high-profile regulator to criticise his agency’s swap trading rules which have resulted in foreign investors shying away from using US electronic venues known as swap execution facilities (SEFs).

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SEFCON V: Tech's Impact on SEFs Keeps Growing

By Dan DeFrancesco
November 13, 2014, Waters Technology

With one year in the books, industry members discussed how technology has affected swap execution facilities (SEFs) and what to expect going forward.

Swap execution facilities (SEFs) have now been in place for a year, and it's becoming increasingly clear that while liquidity is king, technology has a crucial role to play, according to a panel of industry members that gathered to discuss SEF technology trends at the Sefcon V conference yesterday in New York, organized by the Wholesale Markets Brokers' Association Americas.

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SEFCON V: SEF Registration, No-Action Letters Slows Business

By Gabriel Surprise
November 13, 2014, GlobalCapital

The Commodity Futures Trading Commission needs to grant permanent registration for swap execution facilities in order to avoid hindering the evolution of businesses following the implementation of Dodd-Frank. Additionally, the slew of continuing no-action letters is resulting in regulatory uncertainty, according to speakers at SEFCON V.

"The longer the SEF registration process goes on, the more issues seem to pop up," said Matthew Kulkin, senior associate at Squire Patton Boggs. "At a certain point, market participants are going to want to see product registration so that they can start to carry out the onboarding process and select the liquidity providers they want to use.”

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Bloomberg Says Swaps Trading Platform Experiences One-Hour Outage

By Douwe Miedema and Mike Kentz
November 12, 2014, Reuters

A trading platform run by Bloomberg LP for swaps, a type of derivative, was down for almost an hour on Wednesday, the data provider said.

Trading on Bloomberg's so-called Swap Execution Facility, or SEF, experienced an outage for just under an hour from 9 a.m. EST (1400 GMT), a spokesman said, because of problems with formatting data for credit default swaps, or CDS.

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Bloomberg and UBS Clash Over SEF Aggregation

By Peter Madigan
November 13, 2014, Risk

UBS claims users of its Neo platform are being blocked from trading on Bloomberg's Sef; Bloomberg questions value of aggregation

Bloomberg and UBS clashed yesterday over attempts by the Swiss bank to provide clients of its Neo trading platform with access to Bloomberg's swap execution facility (Sef) - a so-called introducing broker service that UBS claims the Sef refuses to support.

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Comment: SEFs Face New Challenges

By Lee Olesky
November 4, 2014 Financial Times

The summer of 2010 marked the beginning of the most radical reform in the history of the US over-the-counter derivatives markets with the ratification of the Dodd-Frank Act.

A marathon of rulemaking and implementation of mandates for the reporting, clearing, and trading of swaps finally led to the creation of Swap Execution Facilities, or Sefs, just over a year ago.

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CDS Notional, Rates Trading Continues to Slide

By Beth Shah
November 3, 2014 GlobalCapital

Overall credit default swap notional that was reported to swap data repositories last week decreased by 21% from the previous week, according to data from the International Swaps and Derivatives Association. Overall interest rate derivatives trading that was reported, also saw a decrease of 17% from the previous week.

ISDA reported that there was a 23% decrease in notional cleared for CDS, and 26% less executed on swap execution facilities, compared with the previous week. Rates saw a smaller decline with 13% less volume cleared, but only 8% less executed on SEFs last week.

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Markit to Shut Down CreditCentre

By Mike Kentz
October 25, 2014 IFR

Markit, the financial information services firm, is in the midst of shutting down its CreditCentre facility operated by its MarkitSERV arm. The platform was one of two services launched in response to Dodd-Frank regulations that focus on migrating over-the-counter swaps onto exchange-like platforms.

The service was set up to act as a central credit checking hub for swaps trades, providing automated pre-trade confirmation that swaps users remained below set credit limits before transactions were executed and cleared in the new Dodd-Frank framework.

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