Derivs - Regulation

Hong Kong Legislative Council will begin debate on regulatory reform today, including the possible merger of the Hong Kong Monetary Authority and Hong Kong Securities and Futures Commission.

A proposed law aimed at pushing all derivatives on an exchange to be regulated by the U.S. Commodity Futures Trading Commission is being predictably shot down by over-the-counter participants.

The Federal Reserve’s commitment of USD800 billion to help loosen the credit markets reeled in the CDX North American Investment Grade index series 11 to 246.5 basis points at press time.

Deutsche Bank has filed a lawsuit against Lehman Brothers Holdings Inc. to recover USD72.5 million it mistakenly transferred to the now bankrupt firm.

Market participants are working on the creation of Shariah-compliant credit default swaps.

New York State Insurance Department Superintendent Eric Dinallo said today his department has chosen to delay indefinitely its plans to start regulating covered credit default swaps—the part of the market it considers insurance.

The Securities Investors Association of Singapore is in discussions with banks and local regulators to establish a risk rating for structured products.

As discussions about how to overhaul the credit default swap market progress, industry officials are thought to be considering two fixed coupons for non-distressed single names: 100 basis points and 500 bps.

Industry participants working on a clearing system for credit default swaps are considering doing away with ‘Modified Restructuring’ as a credit event trigger in North American single-name CDS.

Barclays Bank is disputing claims made by Black Diamond Capital Management in its lawsuit over the messy early termination of a total return swap program the hedge fund had with the bank.

Rabobank has filed suit against a hybrid collateralized debt obligation called Brookville CDO I, charging that the manner in which it has begun liquidating assets will hamper the bank’s ability to get repaid on a secured loan.

The fact a new electronic platform for trading credit default swap indices has launched amid a public relations crisis surrounding the product should help it succeed where previous attempts have failed, according to one user.