Derivs - Regulation

The Commodity Futures Trading Commission should not impose aggregate ownership limits on derivatives clearing organizations, designated contract markets or swap execution facilities, according to a joint letter from industry associations.

France’s Autorité des Marchés Financiers opposes a blanket ban on naked credit default swaps, in contrast with the position taken by French Member of Parliament Pascal Canfin.

Gay Huey Evans, the ex-vice chairman of investment banking and investment management at Barclays Capital, and a former U.K. Financial Services Authority director, has rejoined the International Swaps and Derivatives Association as a vice chairman of the board of directors, and non-executive chairman of Europe.

The U.K.’s Financial Services Authority has been lobbying members of the European Parliament against restricting or banning naked sovereign credit default swaps.

Derivatives legislation in Europe should create a transparent system of clearing that would prevent exchange-owned central counterparties to operate “vertical silo” models and develop a so-called vertical silo market, according to Sharon Bowles, chair of the European Parliament’s Economic Monetary Affairs Committee and shadow rapporteur on derivatives legislation.

The International Swaps and Derivatives Association and the Securities Industry and Financial Markets Association have warned the Commodity Futures Trading Commission against failing to specifically define the anti-disruptive practices rule in connection with the swaps market under Dodd-Frank legislation. A lack of clarity over the new rules could cause some dealers to be wary of engaging in swaps market-making activity, say industry officials.

Examiners at the Securities and Exchange Commission and the Federal Reserve Board have started meeting to hammer out how they will approach examinations of certain systemically important clearing agencies. The SEC has also hired an associate director to oversee clearing agency exams, starting Jan. 10.

Eleven firms have signed up to the International Swaps and Derivatives Association’s Asia Pacific Portfolio Reconciliation Memorandum of Understanding, within two days of its release. Several more are expected in coming weeks.

Tudor Investment Corp. wants the Commodity Futures Trading Commission to give swap users the ability to clear over-the-counter swaps on an individual segregated account basis.

The International Swaps and Derivatives Association has issued an interdealer master confirmation agreement covering equity options in emerging markets.

The majority of bonuses for 2010 paid out to equity derivative traders, structurers and salespeople globally are likely to be lower than for 2009.

The Basel Committee on Banking Supervision is seeking industry comment and suggestions on how banks should capitalize exposure to central counterparties.