Article: Compliance is a Journey, Not a Goal

22 February 2016 | Bill Hodgson

Within the next 18 months the impact of mandatory clearing and the margin on bilateral OTC trades will begin to reshape the OTC market.

For many involved in regulatory compliance, the work has only just started. For CCPs, the scramble to achieve authorization under EMIR hit a crescendo in September 2013. Just five months later, the introduction of OTC trade reporting for EMIR then brought a flurry of activity and much chaos. The pace of regulation hasn’t slowed since then, and neither have the intense demands to remodel internal processes. However, with some of the biggest and most impactful regulatory developments still to take place over the next 18 months, many firms might choose to scale back their short-term compliance investments until there is even greater regulatory clarity.

Trade Reporting

The onset of OTC and ETD trade reporting in Europe in February 2014 created a new industry of trade repositories (TRs) and other services designed to gather, reformat, transfer, and reconcile the vast flow of data required by regulators. However, European trade reporting was significantly different from the U.S., leading

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