Derivs - Regulation
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Pre-trade transparency rules in the Markets in Financial Instruments Directive will be virtually impossible to apply to many trades, including some OTC derivatives, according to Rob Ford, a partner at GBP1.8 billion fixed-income manager TwentyFour Asset Management in London.
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The planned financial transaction tax could lead to direct costs as high as EUR40 million if those corporates are defined as financial institutions under the terms of the tax, according the European Association of Corporate Treasurers.
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The European Commission has instructed the European Securities and Markets Authority to produce draft regulatory standards on the cross-border application of the European Market Infrastructure Regulation by Sept. 25, 2013.
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Mainland Chinese securities firms are not using the recently released Securities Association of China master agreement, opting instead to use the National Association of Financial Market Institutional Investors contract due to regulatory uncertainty, according to officials.
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The Depository Trust & Clearing Corporation and Euroclear have created a joint processing service to aid firms in mitigating risks and costs that are associated with collateral management. The joint service will offer automatic transfer and the segregation of collateral based on agreed margin calls relating to over-the-counter derivatives and other collateralized contracts.
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The Commodity Futures Trading Commission, pursuant to the Dodd Frank Act, has implemented rules which require that all swap counterparties report and keep record of certain swap data.
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Credit default swap contracts with foreign counterparties dropped to USD18.963 trillion at the end of last year, from USD21.572 trillion in H1 2012, according to the Bank of International Settlements.
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The Hong Kong Exchange saw a record volume of deliverable U.S. dollar, offshore China yuan futures traded on Monday following the Chinese government’s plans to tighten up liquidity requirements for foreign currency lending, according to traders.
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The International Swaps and Derivatives Association credit default swap definitions need overhauling to tackle problems with subordinated debt and bail-ins, which have heightened following the credit event of SNS Reaal.
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The New Zealand Exchange has delayed the launch of the country’s equity derivative market, which was originally scheduled to start Wednesday, to ensure the new asset class receives full participation from the country’s buyside community.
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The Australian Securities Exchange is aiming to introduce client clearing for its new over-the-counter derivatives clearinghouse by the end of 2013.
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The European Commission is reviewing the three committees under the umbrella of the European Financial Stability Facility that supervise financial services across Europe.