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AcadiaSoft and TriOptima Tie-Up to Usher in New Margin Hub

By Peter Madigan
May 28, 2015, Risk

A clutch of technology firms and back-office specialists are quietly making progress on a new margining utility for the swaps market – a high-stakes project that has already seen off previously undisclosed plans by the world's biggest dealers to create their own margin hub.

The idea is to create a one-stop shop that takes care of the tasks required by incoming rules on margining for non-cleared over-the-counter trades, such as calculating and automating margin calls, mediating disputes and electronically processing the transfer of collateral. The firms involved include the Depository Trust & Clearing Corporation (DTCC), Euroclear, TriOptima and Acadiasoft. Others also want in.

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Brokers Call for CMU Swaps Extension

By Helen Bartholomew
May 23, 2015, IFR

An ambitious pan-European Capital Markets Union framework that is currently being prepared to break down national barriers and improve corporate access to financing, should be expanded to over-the-counter derivatives, some industry groups suggest.

The broad set of regulatory principles, which are set to be finalised by 2019, represent an effort to reduce financial market fragmentation, strengthen cross-border flows and diversify funding sources for businesses that are struggling to raise finance as banks rein in their lending activities as they come under severe Basel III capital pressures.

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CFTC Looks to Harmonise Uncleared Margin Rules

By Mike Kentz
May 16, 2015, IFR

The CFTC is taking a proactive approach to harmonising upcoming rules for margining uncleared swaps transactions across borders.

The agency last week held a meeting with senior market participants to discuss three different proposals to regulate transactions between US and non-US participants – as well non-US entities that are connected or guaranteed by US parent companies.

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EBA Consults on Swaps Bail-In

By Helen Bartholomew 
May 14, 2015, IFR

The European Banking Authority has launched a public consultation on draft regulatory technical standards for valuing derivatives liabilities that are set to be included in new bail-in rules under the Bank Recovery and Resolution Directive.

With its current proposals, the EBA aims to provide EU resolution authorities with tools to carry out objective valuations based on costs and gains that would be incurred when a counterparty enters into a replacement derivatives trade following the liquidation or restructuring of its financial counterparty.

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Goldman, BofA Among Banks Said to Face Fresh Swaps Scrutiny

By Gaspard Sebag and Aoife White
May 13, 2015, Bloomberg Business

The European Union is re-evaluating its antitrust probe into whether 13 of the world’s biggest banks conspired to shut exchanges out of the credit-default swaps market after a series of mishaps nearly derailed the four-year-old case, according to people familiar with the matter.

EU officials are weighing whether to send a revised antitrust complaint to smooth over cracks exposed at a May 2014 hearing, said one of the people, who asked not to be named because the matter is confidential. The review is nearly finished and regulators aim to decide on the next steps within a couple of months, the person said.

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SEC Nods to Industry in Proposals on CEO Pay, Overseas Swaps

By Dave Michaels and Silla Brush
April 29, 2015, Bloomberg Business

The U.S. Securities and Exchange Commission delivered a pair of rule proposals Wednesday that tilted toward the interests of Wall Street and corporate America as the regulator plodded through a backlog of mandates from the 2010 Dodd-Frank Act.

The five-member SEC voted unanimously to propose a measure that would allow overseas banks to conduct some derivatives trades without having to comply with U.S. regulations. The SEC also proposed a requirement for companies to show annual comparisons of executive pay and the stock’s performance. The rule would allow companies to omit new stock and options, which can make up the biggest part of compensation.

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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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Massad: SEFS Fear Retaliation if They End Name Give-Up

By Peter Madigan
April 23, 2015, Risk

Isda AGM: CFTC chair is “very concerned” by claims that firms are being shut out of Sefs.

A seemingly trivial stand-off over the disclosure of counterparty names may threaten one of the pillars of US swap trading rules – the provision of impartial access – the head of the US Commodity Futures Trading Commission (CFTC) has said.

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D.E. Shaw Sees $65m Swaps Margin Threshold as Exposure Cap

By Kris Devasabai 
April 23, 2015, Risk

Isda AGM: Hedge fund plans to share non-cleared swaps around to reduce trading costs.

DE Shaw will share its swaps business around a larger number of banks in an attempt to limit costs relating to incoming margin rules, a lawyer at the hedge fund has said.

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U.S., E.U. Regulators Trade Barbs Over Swaps

By Katy Burne
April 22, 2015, The Wall Street Journal

Attendees at a derivatives industry conference in Montreal on Wednesday got a front-row seat to a continuing spat between international regulators over cross-border rules for the $700 trillion global swaps market.

Regulators in the U.S. and Europe have been divided over how far their respective rules should affect companies involved in swaps overseas that are already overseen by their home regulators, and whether to deem home-country rules equivalent across borders.

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