Featured Product

    BoE and CFTC Strengthen Supervisory Cooperation in Derivatives Markets

    October 20, 2020

    CFTC and BoE signed an updated Memorandum of Understanding (MoU) regarding cooperation and the exchange of information in the supervision and oversight of clearing organizations that operate on a cross-border basis in the US and the UK. Through this MoU, CFTC and BoE expressed their willingness to cooperate in the interest of fulfilling their respective regulatory mandates, particularly in preserving the benefits of cross-border clearing activity. The CFTC Chair (Heath P. Tarbert) and the BoE Deputy Governor for Financial Stability (Jon Cunliffe) published a joint op-ed article in Risk.net. In this article, they outline the details of the agreement and discuss the framework for regulating the global derivatives markets.

    The op-ed article highlights that the long-lasting significance of regulatory reforms was seen when the COVID-19 pandemic sent shockwaves through the world’s financial markets earlier this year. The agreement entrenches these key principles: the central counterparty’s home country is the primary supervisor; the supervision of central counterparties that operate in both the US and UK is based on close co-operation and mutual respect; and the home authority will take the lead in any response in emergency situations. Both US and UK agree that cross-border infrastructure needs to be held to appropriately high standards. To support safe and efficient global markets, the regulation and supervision of such infrastructure needs to maintain the highest levels of resilience, commensurate with the risks. Also, any conflicting or overlapping regimes need to be avoided, which is why this regulator relationship needs to be founded on the right degree of deference to home supervisors.

    The MoU strengthens the relationship between the regulators responsible for resilience of the largest and most important derivatives markets and central counterparties in the world. The supervision of central counterparties that operate in both US and UK is based on close cooperation and mutual respect for each regulator’s regime and supervisory practices. The MoU recognized the history of cooperation between CFTC and BoE and encouraged supervisory coordination and reliance upon the other authority’s supervision and regulatory framework. The MoU supersedes a 2009 agreement and follows a 2019 joint statement by the CFTC, BoE, and other UK authorities on continuity of derivatives trading and clearing post-Brexit. 

     

    Related Link: BoE News Release

     

    Keywords: Europe, Americas, UK, US, Banking, MoU, CCPs, Derivatives, Cross Border Cooperation, CFTC, BoE

    Related Articles
    News

    EC Regulation Sets Out Standards for Reporting and Disclosure of MREL

    EC published the Implementing Regulation 2021/763 that lays down implementing technical standards for supervisory reporting and public disclosure of the minimum requirement for own funds and eligible liabilities (MREL).

    May 12, 2021 WebPage Regulatory News
    News

    EBA Report Notes Loan Origination Should Remain in Supervisory Focus

    EBA published a report that examines the convergence of prudential supervisory practices in 2020 and offers conclusions of the EBA college monitoring activity.

    May 12, 2021 WebPage Regulatory News
    News

    APRA Decides to Standardize Submission Date for Quarterly Reporting

    APRA announced the standardization of quarterly reporting due dates for authorized deposit-taking institutions.

    May 11, 2021 WebPage Regulatory News
    News

    ECB Working Group Publishes Recommendations on EURIBOR Fallbacks

    The private sector working group of ECB on euro risk-free rates published the recommendations to address events that would trigger fallbacks in the Euro Interbank Offered Rate (EURIBOR)-related contracts, along with the €STR-based EURIBOR fallback rates (rates that could be used if a fallback is triggered).

    May 11, 2021 WebPage Regulatory News
    News

    Bundesbank Publishes Supporting Documentation for Reporting by Banks

    Bundesbank published a list of "EntryPoints" that are accepted in its reporting system; the list provides taxonomy version and name of the module against each EntryPoint.

    May 11, 2021 WebPage Regulatory News
    News

    EBA Publishes Phase 1 of Reporting Framework 3.1

    EBA published the phase 1 of its reporting framework 3.1, with the technical package covering the new reporting requirements for investment firms (under the implementing technical standards on investment firms reporting).

    May 10, 2021 WebPage Regulatory News
    News

    IOSCO Sees Support for Mandatory Sustainability Reporting

    The Sustainable Finance Taskforce of IOSCO held two roundtables, with global stakeholders, on the IOSCO priorities to enhance the reliability, comparability, and consistency of sustainability-related disclosures and to collect views on the practical implementation of a global system architecture for these disclosures.

    May 10, 2021 WebPage Regulatory News
    News

    APRA to Finalize Capital Adequacy Standard Revisions by January 2022

    Asia Pacific Australia Banking APS 111 Capital Adequacy Regulatory Capital Basel RBNZ APRA

    May 10, 2021 WebPage Regulatory News
    News

    ESMA Issues Guidelines on Outsourcing to Cloud Service Providers

    ESMA published the final guidelines on outsourcing to cloud service providers.

    May 10, 2021 WebPage Regulatory News
    News

    EBA Publishes Data on Deposit Guarantee Schemes

    EBA published annual data for two key concepts and indicators in the Deposit Guarantee Schemes (DGS) Directive—available financial means and covered deposits.

    May 10, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 6967