Derivs - Interest Rate

Proposals to ring-fence significant market-making activities of European banks would increase funding costs and restrict banks’ ability to offer cost-effective financing and risk management services to clients, according to a letter from the International Swaps and Derivatives Association and the Association for Financial Markets in Europe.

Kok Tong Tan, head of emerging markets fx and non-deliverable forward trading, and Rajat Ray, director and head of EM rates trading, both left Barclays’ fixed income team in Singapore last week.

The names are emerging of the UBS interest rates trading staffers to leave as part of a wind down of fixed income announced last week.

Mandatory clearing in Japan has expanded the pool of counterparties in interest rate swaps and boosted liquidity as a result.

Gavin Vanderplank, managing director and head of interest rate swaps at UBS in Sydney, has left the firm.

Eric Pellicciaro, the head of global rates in BlackRock’s fundamental fixed income division in New York, is set to leave the asset manager on Friday.

Banks will be required to hold more capital against exposures to central counterparties should a draft regulation from the European Commission be enacted.

Rep. Scott Garrett, R-N.J., vice-chairman of the House Budget Committee, criticized the lack of coordination between the Commodities Futures Trading Commission and the Securities and Exchange Commission on regulation at the SEFCON III conference in New York today.

Notional outstanding over-the-counter derivatives have decreased over the last six months, with the total down 1% to USD639 trillion by the end of June 2012, according to the Bank for International Settlements.

Futures broker Newedge has hired Daniel McGowan, former managing member at consultancy firm Sino Ventures in Philadelphia, as its new China chief representative in Shanghai.

Buying 2m10y receiver butterflies on the U.S. dollar are favorable interest rates trades on the back of U.S. president, Barack Obama’s re-election, according to the Royal Bank of Scotland.

The British Bankers’ Association is proposing discontinuing nine tenors and five currencies in the London interbank offered rate framework, along with the sterling repurchase agreement benchmark.