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Bloomberg Becomes Regulated Trading Venue in Europe

By Philip Stafford
July 26, 2015, Financial Times

Bloomberg is set to fall under the same trading platform regulations as its rivals after the UK markets watchdog approved the fixed-income venue's application to upgrade its legal status.

The US group, one of the world’s largest electronic credit trading venues, will come into line with interdealer brokers like ICAP and Tullett Prebon as it competes in the over-the-counter derivatives market ahead of new European rules due in 2017.

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Swaps Trading Regs Coming, CFTC Head Says

By Jimmy Hoover
July 23, 2015, Law360

Commodity Futures Trading Commission Chair Timothy G. Massad on Thursday said that the agency is inching closer to unleashing a spate of rules on the swaps trading market to bring home the policy goals of the Dodd-Frank Act, including margins on uncleared deals and standards for data reporting.

Massad laid out the agency’s plan at a speech in Washington, D.C., to celebrate the fifth anniversary of the landmark financial law’s passage, in which he commended the CFTC’s efforts looping in a derivatives market deemed majorly responsible for the 2008 financial crisis.

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Swap Execution Facilities: Be Careful What You Wish For

By Paul Golden
July 22, 2015, Global Investor

Data from the Futures Industry Association supports the view that swap execution facilities (SEFs) have made uneven progress. The association’s SEF tracker indicates that trading volume across all three asset classes (interest rates, credit default swaps and foreign exchange) averaged $364.8bn per day in April, down 27% from the previous month but up 8% from April 2014.

The International Swaps and Derivatives Association (ISDA) has been concerned about the fragmentation of derivatives markets along geographic lines since the SEF rules came into force and  says the effects have been particularly notable in the market for euro interest rate swaps.

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U.K. Watchdog Says Up to Courts to Decide on Rate Swaps Spats

By Huw Jones
July 22, 2015, Reuters

Britain's financial regulator has rejected criticism of how small firms are compensated for mis-sold interest rate hedging products, saying it was now up to the courts to rule on disagreements over payouts.

The products were meant to protect smaller companies against rising interest rates, but when rates fell to very low levels after the financial crisis, companies had to pay extra charges, typically running into tens of thousands of pounds.

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Comment: Unique Identifier Codes -- the Jury Is Still Out

By Allan D. Grody
July 21, 2015, FOW

On June 10, 2015 the Swaps Data Repositories (SDRs) of DTCC, ICE and CME collectively responded to the SEC's Final Rule on Security-Based Swaps Reporting (SBSR). This collective response focused exclusively on the details of UIC's (Unique Identity Codes).

While an 'after thought' from their separate earlier comments posted on May 4, they stepped up to add clarity to the issues surrounding unique identity codes such as legal entity, product, transaction, trader, and branch codes -- what we have termed the 'Barcodes of Finance'. The very next day, on June 11, 2015 a group of trade associations, calling themselves the Joint Association representing global swaps participants also published a statement calling for industry members and regulators to rationalize these same codes.

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DTCC Wins Latest Extension as Provider of Identifiers

By Cian Burke
July 21, 2015, FOW

The Commodity Futures Trading Commission (CFTC) has extended its designation of DTCC-SWIFT's Global Markets Entity Identifier as a provider of legal entity identifiers (LEIs) for the purposes of the CFTC's swap reporting rules.

The utility was initially designated as a provider of LEIs, in July 2012 on a two-year term and this was again extended by another year last July.

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The 6 Biggest Dodd-Frank Surprises

By Ed Beeson
July 20, 2015, Law360

At 848 pages, it should be no surprise the Dodd-Frank Wall Street Reform and Consumer Protection Act has been a complex, time-consuming and controversial piece of legislation that has tied regulators and the industry in knots. But five years on, the law has produced some unexpected outcomes, from empowering once-sleepy regulators to squeezing small community banks. Here, Law360 looks at some of Dodd-Frank's biggest surprises.

Still Writing Rules

The architects of Dodd-Frank gave regulators a number of orders on turning the law into actual rules. One was to finish writing the rules within a year of the act being signed into law. Few people probably expected the agencies to stick to the deadlines. But what has surprised many is just how long it has taken regulators to get the job done.

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Lawmakers Call for Easing Rules for Banks’ Internal Swap Trades

By Silla Brush and Jesse Hamilton
July 20, 2015, Bloomber Business

U.S. regulators should consider freeing large banks from having to hold collateral against derivatives used to manage internal risks, top Republican and Democratic lawmakers on a key House panel said in a letter.

Clients of Wall Street firms could face higher costs as a result of a proposed rule calling for lenders to post margin when trading swaps with their own affiliates, Representatives K. Michael Conaway and Collin Peterson wrote in a July 17 letter to six regulators including Commodity Futures Trading Commission Chairman Timothy Massad.

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Swaps Users Lament MAT Rules

By Mike Kentz
July 18, 2015, IFR

Market participants agreed that the CFTC needed to make changes to its highly controversial “made available to trade” rule at a public roundtable last Wednesday.

The roundtable was the first open forum held by the agency on a topic that has long frustrated swaps users. Participants said the rule gave too much regulatory power to swap trading platforms that may be swayed by commercial interests.

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CFTC Takes Aim at Unguaranteed Accounts

By Zoe Thomas
July 15, 2015, IFLR

An effort to avoid regulatory arbitrage is uncleared swap margin regulation may force banks to change course on plans to de-guarantee foreign subsidiaries.

The Commodity Futures Trading Commission's (CFTC) latest proposal, released on June 29, is a hybrid of plans the CFTC put forward last year to address a lack of cross-border regulation in the swap market. The plan, which was unanimously voted on by the commissioners, would take a broad approach to what is captured by the regulatory net, and goes counter to guidance that was previously issued.  

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