Smaller European banks, insurers and funds may find themselves shut out of the swaps market from late next year, an official at the Irish central bank has warned. Martin Moloney, head of the bank's market policy department, says it is not clear there are enough big banks willing to provide access to clearing houses, which will affect thousands of swaps users when clearing becomes mandatory under the incoming European Market Infrastructure Regulation (EMIR).
"Sooner rather than later, existing levels of capital are going to be saturated," Moloney told Risk.net. "We have to be vigilant in monitoring the development of the market to see if it responds adequately to the increased demand."
full article (subscription)