One of the biggest challenges for both the Buy Side and Sell Side with the introduction of mandatory OTC Clearing is the posting of the required collateral for initial margin requirements at the clearing house on a daily basis.
Margin and collateral efficiency have been two of the most frequently discussed topics over the past year or two and will continue to be so for some time. Why is this topic so important? Simply put, the market as a whole is going to need more collateral, and will have to learn to deliver it with greater frequency and efficiency. This article summarizes the key suggestions on how to address these challenges.
The timing of the Bilateral Margin rules has moved to September 2016, along with a phase in period for the requirement to exchange Variation Margin.
From London Loves Business, 10th February 2015
Research paper on 'crowded trades' suggests under-margining in certain cleared market scenarios.
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In a world where money never sleeps and banks continue to seek cost savings by offshoring their operations – where is the best place to base your OTC confirmations team?
CFTC chair Timothy Massad said dealers would gain only a few extra months to comply
Bill: This refers to the bilateral margin rules, you need a subscription to read the full story but the one line summary gets to the point.
Utility provider will offer a more efficient way for banks and brokers to deal with regulation
First conference from The OTC Space in Stockholm on March 24th.
The UK won the right to continue to clear euro denominated products when the ECJ ruled on March 4th in its favor.
The dust has settled from the initial fall out from retail brokerages going out of business as a result of the SNB's abrupt removal of the CHF vs EUR peg several weeks ago.
So I think it's time to ask a deeper question - does it make sense to use risk-based margins in retail FX proprietary trading? After a quick review I can't see a good reason why not.
With all the discussion about Dodd-Frank, Volcker Rule, Basel III and EMIR, it’s easy to forget the last piece of the puzzle, Europe’s Markets in Financial Instruments Directive 2, Europe’s Markets in Financial Instruments Regulation, and Regulato
At an eight month lag to the base reported data it is based on, BCBS's half yearly Basel III monitoring report was published recently looking at banks' progress towards meeting Basel III capital and liquidity rules. On the surface the report seems to have a pretty positive message. Reading between the lines and combining with other information there is a more interesting story behind the numbers on what it will take to meet the minimum ratios.
A little more on the recent cross-margin announcement
Brandywine Global Selects SunGard’s Apex Collateral to Support Margin Workflow Operations and Regulatory Reporting
The outcome of a long running legal battle over an ECB policy to require CCPs clearing EUR to locate themselves within the Eurozone is announced.
Good coverage by the FT on the ECJ ruling - political background which goes right up to George Osborne the Chancellor on how the opposite outcome could hasten a British exit from the EU.
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