Focus IM Rules on Risk and Readiness

Four months from now, the industry will be putting the final touches on the implementation of the fourth and penultimate phase of the initial margin (IM) requirements for non-cleared derivatives. For many participants, though, the real challenge continues to be how to meet the phase-five deadline one year later, despite an initiative by standard-setters to reduce the risk of a compliance bottleneck.

CFTC signals mitigation mojo

The CFTC is the first Regulator to break cover following the 5 March BCBS\IOSCO IM Phase 5 statement. The outgoing Commission Chairman Giancarlo has released a letter sent to Federal Reserve Board Vice Chairman Randal K. Quarles recommending that US regulators issue guidance echoing the BCBS mitigation. CC’ing the FCA, the BoE and ESMA, he […]

Bill: Firms who hope they might avoid preparing for Phase 5 should follow this topic. IMO this doesn't change anything, if you are above the notional threshold then you need to make full preparations.

How liquidity add-ons can impact margin

Top 20 Firms Collected Nearly $160 Billion in Initial Margin at Year-End 2018, Survey Finds

ISDA has published its latest margin survey, which shows the amount of initial margin (IM) collected by the 20 largest market participants for their non-cleared derivatives trades continued to rise in 2018.

ISDA Margin Survey Year-End 2018

The ISDA Margin Survey looks at the impact of regulatory and other changes on collateral practices, and analyzes the amount and type of initial margin (IM) and variation margin (VM) posted for non-cleared derivatives, and the IM posted for cleared transactions.

Cassini Systems partners with SmartStream to help firms meet Uncleared Initial Margin obligations

London and New York – March 20th, 2019 – Cassini Systems, the leading provider of pre and post trade margin analytics for buy side derivatives trading, today announced its partnership with SmartStream Technologies, the financial Transaction Lifecycle Management (TLM®) solutions provider, to help financial institutions comply with BCBS-IOSCO margin requirements for uncleared OTC derivatives.

Tackling the IM Challenge

Let’s start with the good news. The Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) last week published a statement highlighting that counterparty relationships that fall below an initial margin (IM) exchange threshold aren’t obliged to meet documentation, custodial or operational requirements.

ISDA Response to BCBS/IOSCO Statement on Non-cleared Margin Requirements

ISDA has published the following response to the statement by the Basel Committee on Banking Supervision and International Organization of Securities Commissions on the final implementation phases of the margin requirements for non-centrally cleared derivatives.

IM Phase 5 mitigation…’ish

Banks have spent the last four years gamely preparing for and complying with IM regulations. Phases 1-3 have been challenging, the current phase 4 promises more of the same. The market has long been aware that phases 1-4 are mere kittens to the phase 5 (probably angry) tiger. Useful initiatives- negotiation platforms, custodian portals, standardised […]

How estimating CCP margins could save you millions