Derivs - Regulation

The Bank of England has defended its role in the Libor scandal and has published a chain of e-mails between itself, the U.S. Federal Reserve and the British Bankers’ Association, which shows that the BoE put pressure on the association to reform the benchmark in 2008.

On June 29, the U.S. Commodity Futures Trading Commission published a proposed policy statement and interpretive guidance addressing the extraterritorial reach of the swaps provisions of the Commodity Exchange Act that were enacted by Title VII of the Dodd-Frank Act.

The Australian Prudential Regulation Authority has changed its stance on the treatment of collateral supporting derivatives between an issuer of covered bonds and its special purpose vehicle.

Société Générale will repay over USD11 million to clients of its wealth management division after the Hong Kong Securities and Futures Commission reprimanded the dealer for allegedly not disclosing certain fees and charges in secondary market transactions of over-the-counter bonds, options and structured notes.

China’s National Association of Financial Market Institutional Investors is looking to bolster the creation of new credit risk management products via a new financial derivatives professional committee.

Japan’s Financial Services Agency could require dealers to store trade data, since a viable trade repository will not be ready when mandatory clearing starts later this year.

A number of requirements in a proposal from the European Commission for the creation of key information documents alongside investment products have been criticized by the European Structured Investment Products Association for being overly detailed and running counter to the original intentions of the regulation.

Structured product issuers in Asia need to develop communication lines with program directors based in Europe to insure their deals are compliant with the new European Prospective Directive, according to lawyers.

The Managed Funds Association has called on the European Securities and Markets Authority to introduce a real-time acceptance within technical standards of the European Market Infrastructure Regulation.

A move by the European Securities and Markets Authority to set the clearing thresholds per asset class for non-financial counterparties was criticized by BP and Shell officials at a public hearing in Paris Thursday.

The European Securities and Markets Authority will look closer at the argument for an exemption of fx forwards from clearing requirements under the European Market Infrastructure Regulation and will discuss the issue further with U.S. regulators.

Sovereigns, such as central governments, sovereign wealth funds, central banks and other supranational institutions, are expected to embrace central clearing voluntarily and post collateral to bilateral commercial counterparties due to the indirect impact of regulation on bilateral derivatives pricing, according to a report on over-the counter derivatives reform by BNY Mellon.