Derivs - People and Markets

The made-available-to-trade regulation in the US appears to have created smaller, less liquid pools for euro and sterling swaps on swap execution facilities relative to US dollar swaps, according to research from the International Swaps and Derivatives Association.

End-users have called for exemptions from margin requirements and for the right to trade over-the-counter products, warning that forcing derivatives to trade on an exchange could negatively impact market liquidity and many firms' growth prospects.

The costs of the trade execution mandate are outweighing the benefits it provides to market participants, according to Stephen O'Connor, chairman of the International Swaps and Derivatives Association.

The absence of an exemption for pension funds in Switzerland’s derivatives regulatory proposals within its draft Financial Market Infrastructure Act will drive up costs and staffing pressures for such users, according to lawyers.

Blythe Masters, head of the global commodities group and CIB regulatory affairs at JPMorgan in New York, is to leave the firm after 27 years. Masters is widely regarded by market participants as one of the leading figures active in the development of the credit derivatives market in the 1990s.

Manvir Nijhar, the former co-head of equity derivative flow sales for Europe, the Middle East and Africa at Citigroup in London, has joined BNP Paribas in a senior equity derivatives sales role, also in London.

The US Commodity Futures Trading Commission has extended its temporary no-action relief for swaps trading on multilateral trading facilities in European Union member states, following calls from MTFs for more time.

The move by the US Commodity Futures Trading Commission in February for no-action relief for multilateral trading facilities in the EU from the swap execution facility registration requirement doesn't include an exemption for trading platforms which exist outside of the EU, raising fears for some market participants.

ISDA and Markit have added to the portfolio of tools available on ISDA Amend to help market participants prepare for a change in segregation rules that come into force on May 5.

The Securities Industry and Financial Markets Association has submitted comments to numerous regulatory agencies surrounding margin requirements for non-centrally cleared swaps and security-based swaps, with one being adopting a weekly initial margin schedule to minimise disruptive margin disputes.

BANKING

The US Department of the Treasury is to give relief from the application of proposed regulations under Internal Revenue Code section 871(m) to equity-linked derivative transactions. Instead of applying to equity-linked derivatives acquired before March 5, the new rules will only apply to equity-linked derivatives issued more than 90 days after the new regulations are finalised.