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    HKMA Revises Implementation Schedule for Initial Margin Rules

    August 16, 2019

    HKMA intends to adopt a revised implementation schedule for the margin requirements for non-centrally cleared derivatives. The final phase of initial margin requirements that was originally scheduled on September 01, 2020 will be postponed to September 01, 2021. Additionally, an interim phase with an aggregate average notional amount (AANA) threshold of HKD 375 billion will be introduced for the one-year period starting from September 01, 2020. The Supervisory Policy Manual module CR-G-14 will be amended accordingly before the end of this year. HKMA expects that authorized institutions will act diligently to make all relevant arrangements on a timely basis and comply with the requirements by this revised timeline.

    BCBS and IOSCO recently issued a joint statement on extending the final implementation of the initial margin requirements by one year. With this extension, the final implementation phase will commence on September 01, 2021, at which point covered entities with AANA of non-centrally cleared derivatives greater than EUR 8 billion will be subject to the initial margin requirements. To facilitate the extension, BCBS and IOSCO introduced an additional implementation phase whereby covered entities with an AANA of non-centrally cleared derivatives greater than EUR 50 billion will be subject to the initial margin requirements for the period from September 01, 2020 to August 31, 2021.

     

    Keywords: Asia Pacific, Hong Kong, Banking, Securities, OTC Derivatives, Margin Requirements, AANA, Implementation Timeline, IOSCO, BCBS, HKMA

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