OTC shrank by ~20% in six months: from $25tn at end 2012 to $20tn market value by end H1 2013. Not yet clear why.
Now that Reporting for Europe has come into effect I am looking further into the next challenges that await for us just around the corner and I would like to share some thoughts in this post and in others coming soon on what I believe will be one
Eurex Clearing's application to be recognized as CCP under EMIR has been temporarily set back...
A judged trimmed DTCC's lawsuit against CFTC's determination on CME rule 1001 but allowed the core of the action to proceed, according to a Reuters article. Paradoxically the CFTC may be glad in the long run to concede the suit: if that is it serious about meaningful systemic risk information becoming available to it in any kind of reasonable time frame.
IFR produced another article bemoaning the liquidity problems in the secondary credit bond market. An illustrative statistic is bank inventory: 2007 US$235bn; now "a mere" US$37bn. Aside from the day-to-day market liquidity challenge, have regulatory capital rules indirectly created a significant increase in buy side liquidity risk?
How does money really physically move between different banks in different currencies? It's not just a SWIFT message.
There are many ways to reduce a portfolio and simply it for operational and economic purposes
Europe’s biggest event on buy-side strategy, performance, operations & technology
SwapClear announces it's four permutations of EMIR segregation models
Skills / experience required:
Members of the Korean Exchange surprised by the order in which a broker default was funded
It's worth reading this article: "Swaps revolution falling flat" from Bloomberg. In a nutshell it says that after 2 weeks of SEF MAT, the split between dealer-to-dealer (D2D) and client-to-dealer (C2D) has been preserved. I'm still wondering whether it will ever happen.
Just to start warming up for our next steps and in case you haven't had the time to notice, being fully occupied with EMIR Reporting after-implementation effects, there is another deadline fast approaching.
Following my post last week, I took a quick look at IRS SEF MAT week 2. It is unclear why there has been no post-MAT shift onto SEFs but perhaps we are seeing a post-MAT shift of EUR offshore.
"We believe that the fixed rate full allotment (FRFA) reverse repo will become the Fed’s central policy tool" says Barclays Joe Abate in a research note last Friday. I'm wondering if a Fed monetory policy shift from Fed Funds to FRFA rates will also prompt the shift of interest rate benchmarks from unsecured to secured funding rates.
The first IRS executed on UBS NEO agency exeuction platform happened last week. Perhaps agency execution is off to a slow start but it's a start nonetheless. Agency execution's success seems to partly depend on each SEFs relative implementation priorities and competitive strategy.
FT reported (subs. required) and Reuters re-reported (free) that Deutsche Bank (DB) is adjusting its structure to curtail US balance sheet and the associated capital redundancies introduced by the new Fed intermediate US holding company rules.
Did you watch the 2014 Winter Olympics? Its true that I am quite mad about sport (as long as I’m not doing it) but there is always something magical about the Olympic Games.
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