Derivs - Regulation

The Reserve Bank of India’s tough rules governing the new credit default swaps market could hurt growth of the CDS market, according to Ajay Mahajan, managing director and head of financial markets at UBS.

India should have a local over-the-counter derivative trade repository, despite arguments from the industry for global trade repositories, according to the Reserve Bank of India’s working group on reporting of OTC interest rate and fx derivatives.

Rep. Spencer Bachus (R-Ala.) denied that the 18-month delay to implement tougher derivatives regulations, which was approved Tuesday by the House Financial Service Committee, is an effort to weaken them.

Michel Barnier, the European Union’s commissioner for internal market and services, told the European Parliament that he will propose rules aimed at curbing speculation in derivatives.

South Korea’s Financial Services Commission is looking to increase penalties for those engaged in stock manipulation and insider trading.

The 14 central counterparty platforms launched in response to new regulation on over-the-counter derivatives clearing are unlikely survive for long, according to a recently released whitepaper by Joe Anastasio and Pramod Achanta, partners at Capco.

Introducing brokers may face major regulatory headaches unless the Commodity Futures Trading Commission takes action before the first anniversary of the Dodd-Frank Act, according to Kenneth Kopelman, partner with Bingham McCutchen.

Dealers say a 50% of notional collateral requirement for corporates in China when selling credit protection to banks will make that sect of the market too expensive and unworkable.

The Reserve Bank of India has set Oct. 23 for the launch of credit default swaps, and has issued final guidelines that, among other things, lowered the minimum capital market makers needs to buy CDS from a 12% risk assets ratio to 11%.

Pension funds and nonfinancial corporates won exemptions from central clearing under the European Market Infrastructure Regulation in today’s vote in the European Parliament’s Economic and Monetary Affairs Committee.

The Financial Services Authority is expanding its reporting requirements for on-exchange derivative transactions that would increase the costs of technology for dealers, according to lawyers.

The Australian Prudential Regulation Authority will require a stressed value-at-risk calculation to better capture the credit risk of complex and derivatives trades when calculating capital adequacy, according to a report released this week.