Derivs - Regulation

China’s cautious approach to credit default swaps (CDS) has left the market a minnow compared with other large financial systems. Paolo Danese investigates.

The International Swaps and Derivatives Association this week asked its members for feedback on the potential integration of smart contract functionality into the definitions that govern derivatives transactions.

Four major capital markets and banking industry bodies have urged European legislators to change existing rules to allow for more efficient risk reduction in the derivatives markets.

The Financial Conduct Authority on Monday expressed concerns over the potential consolidation of market power in the hands of a few trading and clearing players, saying that a "lack of competition" could result in "higher prices" or a reluctance to invest to meet client needs.

After months of posturing, pan-European securities watchdog ESMA came down hard on "speculative" retail derivatives, restricting or banning products for three months.

The Financial Services Committee of the US House of Representatives on Wednesday waved through a bill that could allow banks to remove initial margin for centrally cleared derivatives from their leverage exposure, and thus hold less capital.

The Futures Industry Association has called for changes to European derivative reporting rules, suggesting that some aspects of the regulations are "duplicative" and not properly tailored to listed products.

A top US derivatives regulator on Wednesday went into battle against his European counterparts over their new proposal that will increase the stringency of the EU’s oversight of foreign clearing houses.

Frustration boiled over at the Futures Industry Association's (FIA) annual Boca Raton meeting on Wednesday, with Commissioner Brian Quintenz of the US Commodity Futures Trading Commission (CFTC) threatening European regulators with obstruction.

Commissioner of the US Commodity Futures Trading Commission Brian Quintenz attacked the “perverse outcomes” stemming from the supplementary leverage ratio and its treatment of segregated margin, in a speech to the US securitization industry’s annual SFIG Vegas conference.

European Central Bank president Mario Draghi on Monday welcomed proposed EU powers over the clearing of derivatives in foreign jurisdictions, calling recent legislative efforts by the European Commission a “necessary initiative”.

The Financial Conduct Authority on Tuesday called upon technology experts from across the finance industry to give feedback on a new automated way to provide the FCA with regulatory reports.