Derivs - Regulation

The Hong Kong Exchange is planning a round of simulations in the third quarter of this year, to test its newly constructed central counterparty for clearing over-the-counter derivatives, according to a statement in its financial results.

The European Securities and Markets Authority has written to the European Commission to ask for a one year delay, to January 2015, in introducing the requirement to report exchange-traded derivatives trades to trade repositories.

Large European banks are likely to strictly control their derivatives trading, especially of riskier instruments, as they strive to meet Basel III leverage ratio capital requirements, according to strategists at Royal Bank of Scotland.

The Hong Kong Securities and Futures Commission will require clearinghouses seeking recognition to submit a self-assessment detailing how they comply with the standards for financial market infrastructure set out by the Committee on Payment and Settlement Systems of the Bank for International Settlements and the International Organization of Securities Commissions.

The European Securities and Markets Authority has broadened the reach of clearing requirements for non-financial counterparties in its latest update on the European Markets Infrastructure Regulation. Derivatives executed outside the E.U. will now count towards the clearing threshold for non-financial counterparties.

Retail structured products issuers in India are awaiting clarification from the Reserve Bank of India, due next month, that could make issuance of privately placed transaction easier.

CLS Group is opening an office in Hong Kong that becomes operational Aug. 20.

South Korea’s plan to introduce a derivatives transaction tax in 2014 could hurt volumes and liquidity in the KOSPI 200 futures and options market, and will face stiff opposition from the market.

Hong Kong structured product volumes could see an uptick prior to the Chinese government’s third plenary session to be held in October, which is expected to herald a number of major reforms to the nation’s economy.

Bloomberg has added a derivatives margin calculator developed by LCH.Clearnet. The Swapclear margin approximation risk tool – or SMART–allows Bloomberg clients to work out the capital funding requirements needed to comply with Dodd Frank regulations.

Banks should use clearing and compression to shield uncleared derivatives from the impact of a supplementary 6% leverage ratio proposed by U.S. regulators, according to strategists at Barclays in New York.

Bloomberg has received temporary registration approval from the U.S. Commodity Futures Trading Commission to operate a multi-asset class swap execution facility.