Derivs - People and Markets

Coordination between Europe and the U.S. is essential in an effort to regulate the over-the-counter derivatives markets, Gary Gensler, chairman of the Commodity Futures Trading Commission, told a European Commission gathering in Brussels this morning.

Sharon Bowles, chair of the European Parliament’s Economic and Monetary Affairs Committee, acknowledged at a conference yesterday that London’s position as the epicenter of Europe’s over-the-counter derivatives market may slip as regulators look to change the rules.

The Australian Financial Markets Association has introduced standardized documentation for carbon derivatives under Australia’s Carbon Pollution Reduction Scheme—a cap-and-trade system that could be introduced next year, if passed by Parliament.

The multi-billion dollar Indian participatory note market is at risk following a regulatory proposal that threatens to nix tax treaties that have allowed noteholders and issuers hedging those instruments to avoid capital gains tax.

Barclays Capital will issue USD100 million in structured notes next week linked to Citigroup stock. The offering is the biggest registered in months, according to market watchers.

There’s speculation that Rep. Collin Peterson (D-Minn.), chairman of the House Agriculture Committee, could be considering his own over-the-counter derivatives bill, independently from Barney Frank (D-Mass.), chairman of the House Financial Services Committee.

European regulators are warning against adopting the same over-the-counter regulatory proposals being put forward in the U.S.

The European Commission and the U.K. Financial Services Authority plan to require marketers to reveal the identity of counterparties on retail structured products and underscore all risks to investors.

BNP Paribas and Credit Suisse are marketing a one-year equity yield note linked to a basket of three stocks.

Rainer Jaeger, a director and emerging markets fx options trader at Merrill Lynch in Hong Kong, left approximately two weeks ago.

The Bank of New York Mellon has hired Fiona Chan as Asia Pacific head of derivatives sales in Hong Kong—a newly created role at the firm encompassing fx, rates and hybrid structures.

A new over-the-counter derivatives bill put forward by Sen. Jack Reed (D-RI) would give the Securities and Exchange Commission oversight of all security-based derivatives, including those referencing broad-based indices—indices with 10 or more component securities.