Derivs - Regulation

The Fixed Income Connectivity Working Group, led by 13 dealers and supported by interdealer brokers and electronic fixed income venues, is to look at ways of applying the standard FIX protocol to electronic trading of fx options.

End users have been buying calls on the Hong Kong dollar against the U.S. dollar following speculation the Hong Kong Monetary Authority could de-peg the currency from the U.S, according to market officials.

LCH.Clearnet is evaluating whether it will be able to accept corporate bonds as eligible collateral for cleared over-the-counter derivative trades.

The International Organization of Securities Commissions is advising member regulators to require over-the-counter physical commodities derivatives to be reported in trade repositories.

The International Swaps and Derivatives Association plans to implement new dispute resolution procedures by month-end and a narrowed version of the standard credit support annex for derivatives transactions by the middle of next year.

The International Swaps and Derivatives Association has urged Canadian regulators to follow the same format of global trade repositories should it decide to push ahead with a local trade repository in the country.

Industry officials are concerned how the implementation of swap execution facilities under Dodd-Frank will bring stability to the derivatives market.

The International Swaps and Derivatives Association is planning a second study on block trade thresholds in the context of swap execution facility implementation.

The next proposal for the definition of a swap dealer is likely to come by mid-October and Dodd-Frank rulemakings as a whole are aimed to be completed by the third quarter of 2012, according to Scott O’Malia, commissioner at the Commodity Futures Trading Commission.

End users are urging the Commodity Futures Trading Commission to exempt inter-affiliate swaps from most if not all Dodd-Frank swap execution and reporting requirements.

Industry professionals are waiting to see whether or how regulators from the Securities and Exchange Commission and Commodity Futures Trading Commission can square two different approaches to planned business conduct rules for swap entities.

The Basel Committee is expected to release additional guidance on the risk capital treatment of initial margin and default fund contributions within the next four weeks.