General Information & Client Service
  • Americas: +1.212.553.1653
  • Asia: +852.3551.3077
  • China: +86.10.6319.6580
  • EMEA: +44.20.7772.5454
  • Japan: +81.3.5408.4100
Media Relations
  • New York: +1.212.553.0376
  • London: +44.20.7772.5456
  • Hong Kong: +852.3758.1350
  • Tokyo: +813.5408.4110
  • Sydney: +61.2.9270.8141
  • Mexico City: +001.888.779.5833
  • Buenos Aires: +0800.666.3506
  • São Paulo: +0800.891.2518
June 29, 2017

FSB published three reports setting out progress on reforms to over-the-counter (OTC) derivatives markets. These reforms are trade reporting of OTC derivatives; central clearing and exchange or electronic platform trading of standardized OTC derivatives; and higher capital and minimum margin requirements for non-centrally cleared derivatives. The three reports look at the effectiveness of these reforms and their broader effects since the crisis; progress in implementation since June 2016; and progress in addressing legal barriers to reporting and accessing OTC derivatives trade data.

The report on review of OTC derivatives market reforms, which will be delivered to the Hamburg G20 Summit, finds that implementation of the reforms is now well-progressed. However, this has taken longer than originally intended due to the scale and complexity of the reforms and other challenges. Implementation is still ongoing and is generally most advanced in the largest OTC derivatives markets. Further effort will be required to finish the job. Further study should be made of the effects of the reforms in protecting against market abuse. Meaningful progress has been made toward mitigating systemic risk and improving transparency, with some authorities reporting use of trade repository data for market surveillance purposes. However, significant challenges remain and it is important to complete work quickly to improve the quality of, and ability to aggregate, trade repository data, including by removing legal barriers to the full reporting and sharing of such data. In addition, cross-border cooperation, including over the timing of implementation, is important to help reduce market fragmentation.

 

The twelfth progress report on implementation of OTC derivative reforms reports the latest steps taken by jurisdictions since June 2016. Since the last progress report, the number of FSB member jurisdictions with comprehensive margining requirements for non-centrally cleared derivatives increased by 11 to a total of 14. However, 10 jurisdictions still do not have margin requirements in force in accordance with the internationally agreed implementation schedule for these reforms, and these jurisdictions should urgently take steps to implement these reforms. Comprehensive trade reporting requirements for OTC derivatives and higher interim capital requirements for non-centrally cleared derivatives are now mostly in force across member jurisdictions. Since June 2016, progress continued, albeit at a slower pace, in implementing central clearing frameworks, final capital requirements for non-centrally cleared derivatives, and platform trading requirements. The number of central counterparties (CCPs) available to clear OTC derivatives increased to 32 and cross-border availability of CCPs has also increased. Authorization of new trade repositories also continued. FSB, working with standard-setting bodies, will use its new post-implementation evaluation framework (to be published ahead of the July G20 Summit) to assess the interaction of the reforms on incentives to centrally clear OTC derivatives and will publish the results from this work in late-2018.

 

The progress report on plans by FSB member jurisdictions to address legal barriers to reporting and accessing trade data sets out the steps jurisdictions have taken to meet the agreed deadlines (end-June 2018 for the key commitments) for removing these barriers, following the publication of jurisdictions’ plans in August 2016. The progress report describes a number of significant actions taken by authorities of the EU, France, Singapore, and the U.S. in the last year to address barriers. However, major gaps and issues remain to be addressed across the FSB membership. It is essential that FSB member jurisdictions address the remaining issues by the committed deadlines in 2018. The FSB will continue to monitor progress and will publish, ahead of the G20 Leaders’ Summit in Argentina in 2018, a report on the extent to which member jurisdictions have met their commitments to remove barriers.

 

Related Links

Review Of OTC Derivatives Market Reforms

Twelfth Progress Report on Implementation

Progress Report on FSB Member Plans

Keywords: International, FSB, OTC Derivatives, Regulatory Reforms, Trade Repository, Central Clearing, Securities

Related Articles
News

HKMA Decides to Maintain Countercyclical Capital Buffer at 2.5%

HKMA announced that, in accordance with the Banking (Capital) Rules, the countercyclical capital buffer (CCyB) ratio for Hong Kong remains at 2.5%.

April 16, 2019 WebPage Regulatory News
News

EP Approves Agreement on Package of CRD 5, CRR 2, BRRD 2, and SRMR 2

The European Parliament (EP) approved the final agreement on a package of reforms proposed by EC to strengthen the resilience and resolvability of European banks.

April 16, 2019 WebPage Regulatory News
News

FDIC Consults on Approach to Resolution Planning for IDIs

FDIC approved an Advance Notice of Proposed Rulemaking (ANPR) and is seeking comment on ways to tailor and improve its rule requiring certain insured depository institutions (IDIs) to submit resolution plans.

April 16, 2019 WebPage Regulatory News
News

EP Resolution on Proposal for Sovereign Bond Backed Securities

The European Parliament (EP) published adopted text on the proposal for a regulation of the European Parliament and of the Council on sovereign bond-backed securities (SBBS).

April 16, 2019 WebPage Regulatory News
News

PRA Seeks Input and Issues Specifications for Insurance Stress Tests

PRA announced that it will conduct an insurance stress test for the largest regulated life and general insurers from July to September 2019.

April 15, 2019 WebPage Regulatory News
News

PRA Finalizes Policy on Approach to Managing Climate Change Risks

PRA published the policy statement PS11/19, which contains final supervisory statement (SS3/19) on enhancing banks’ and insurers’ approaches to managing the financial risks from climate change (Appendix).

April 15, 2019 WebPage Regulatory News
News

EBA Single Rulebook Q&A: First Update for April 2019

EBA published answers to nine questions under the Single Rulebook question and answer (Q&A) updates for this week.

April 12, 2019 WebPage Regulatory News
News

EIOPA Statement on Application of Proportionality in SCR Supervision

EIOPA published a supervisory statement on the application of proportionality principle in the supervision of the Solvency Capital Requirement (SCR) calculated in accordance with the standard formula.

April 11, 2019 WebPage Regulatory News
News

FED Updates Form and Supplemental Instructions for FR Y-9C Reporting

FED updated the form and supplemental instructions for FR Y-9C reporting. FR Y-9C is used to collect data from domestic bank holding companies, savings and loan holding companies, U.S intermediate holding companies, and securities holding companies with total consolidated assets of USD 3 billion or more.

April 11, 2019 WebPage Regulatory News
News

OSFI Finalizes Guidelines on Liquidity Adequacy and NSFR Disclosures

OSFI published the final Liquidity Adequacy Requirements (LAR) guideline and the net stable funding ratio (NSFR) disclosure requirements guideline.

April 11, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 2929