Derivs - Interest Rate

BNY Mellon is developing support for swap execution facilities and the ability to report to trade repositories in anticipation of the finalization of derivatives regulations.

The South Korea National Assembly has approved a tax on non-deposit foreign currency liabilities, that could capture foreign currency collateral held against derivatives transactions, beginning Aug. 1.

UBS has agreed to pay USD160 million to settle state and federal investigations into its transactions involving municipal derivatives between 2001 and 2004.

The latest proposed text of the European Market Infrastructure Regulation from the European Council’s presidency limits clearing obligations to over-the-counter derivatives, running counter to moves by the European Commission and the European Parliament to encompass all derivatives.

Hedge funds over the past few months have ramped up sales of sterling-denominated 0% inflation floors and purchases of 5% inflation caps to dealers.

The House Agriculture Committee has voted to delay the July 21 deadline for developing rules governing derivatives rules for 18 months.

Mary Schapiro, chair of the U.S. Securities and Exchange Commission, testified before Congress that she would use USD74 million of a requested SEC budget of $1.4 billion to hire derivatives specialists, increase oversight of credit raters and to oversee compliance of Dodd-Frank requirements.

Derivatives market participants questioned why European regulators have chosen now to launch an antitrust investigation into the industry at a time when imminent over-the-counter derivatives reform will likely create greater competition anyway.

Morgan Stanley has hired ex-Barclays Capital salesman Stephane Babin in Paris to sell rates and credit, both cash and derivatives.

Société Générale has hired Alan Mittleman to be its head of fixed income trading, including swaps, for the U.S. based in New York.

Derivatives dealers and investors expect implementation of regulations related to interest rate swaps to take up to two-and-one-half years, far beyond the projected operational date of the end of 2012.

The U.S. Department of the Treasury will exclude fx swaps from derivatives regulations.