Lawyers were concerned over-the-counter derivative volume clearing via Singapore Exchange’s clearinghouse could be affected if U.S. authorities did not provide adequate recognition needed under the Dodd-Frank act. Under Dodd-Frank, U.S. regulators would have to recognize the clearinghouse as a suitable counterparty for a U.S. bank affiliate or branch for clearing purposes. [The U.S. has laid out rules governing the approval of clearinghouses, with both Singapore and Japan signaling they will adapt to comply. Meanwhile, Japanese counterparties are increasingly shifting counterparties from U.S. to European firms in order to distance themselves from Dodd-Frank compliance, (See story, page 1)].
