Derivs - Regulation

The notional amount of over-the-counter derivative trades outstanding at the end of December was USD592 trillion, according to the Bank for International Settlements, 13.4% down from the USD683.7 trillion reported six months earlier.

The International Derivatives Clearing Group, an independent subsidiary of The Nasdaq OMX Group, will expand the coverage of its central counterparty clearing platform to currencies outside the U.S.

The defense against the first U.S. credit default swaps insider trading case will hinge on three points: that the CDS reference entities were not issued in the U.S. so the Securities and Exchange Commission cannot bring the case; the alleged “material non-public information” was public; and that there was no fiduciary agreement in place limiting the use of information provided to the purchase of bonds and not CDS.

U.S. Treasury Secretary Timothy Geithner outlined the Obama administration’s plans for regulating over-the-counter derivatives last Wednesday.

A group of buysiders has launched a working group to address how buysiders should participate in the central clearing of credit default swap trades.

Lawyers are seeing a surge in requests for reviews of arbitration clauses that have been tacked onto over-the-counter derivative contracts.

The International Swaps and Derivatives Association is expected to complete its Wind Event Swap Confirmation documentation by month end, enabling users to speculate or hedge against losses from natural catastrophes.

Three new requests were put to the International Swaps and Derivatives Association’s Credit Derivatives Determination Committee yesterday as market participants that chose not to rebook trades in the wake of old succession events sought advice on their contracts.

The International Swaps and Derivatives Association is working on a set of protocols for dealers and buysiders to use when facing margin call disputes.

The International Swaps and Derivatives Association is readying documentation to support options and swaps on the Standard & Poor’s BRIC 40 index, made up of the largest and most liquid stocks in Brazil, Russia, India and China.

Lawyers in Hong Kong expect a number of collateral disputes on derivative contracts to end up in litigation.

Credit default swaps on the bank holding companies involved in the U.S. government’s stress tests did not widen as news reports of their capital shortfalls began leaking out this afternoon.