Featured Product

    CFTC Seeks Comments on Swap Clearing Requirements for IBOR Transition

    November 23, 2021

    The Commodity Futures Trading Commission (CFTC) is seeking comments on how it could amend the swap clearing requirement to address the cessation of certain interbank offered rates (IBORs) used as benchmark reference rates and the market adoption of alternative reference rates—namely, the overnight, nearly risk-free reference rates. It also includes enumerated requests for data and other information related to IBOR and alternative reference rate swaps and enumerated requests for comment related to the CFTC’s current swap clearing requirement, alternative reference rate swaps, new swap product documentation, and swap clearing requirement specifications. CFTC will use the information and comments received to inform modifications to the CFTC’s swap clearing requirement to address ongoing benchmark transition efforts. The feedback period ends on January 24, 2022.

    CFTC recognizes that information related to the transition away from IBORs is changing daily. Thus, it invites commenters to provide new or updated information related to any aspect of the transition away from IBORs that may offer additional background for CFTC to consider. CFTC requests information related to a derivatives clearing organization's ability to continue clearing or offering clearing services for swaps that reference GBP LIBOR, JPY LIBOR, CHF LIBOR as well as 1-week and 2-month USD LIBOR after December 31, 2021, EONIA after January 03, 2022, or, in the case of remaining USD LIBOR tenors and SGD SOR-VWAP, after June 30, 2023. CFTC also requests comments on actions or regulatory amendments that could facilitate the IBOR transition for market participants. If CFTC recommends to modify the termination date range, or any other specifications, with respect to SONIA overnight index swaps (OIS), AONIA OIS, CORRA OIS or any other OIS that are subject to the Clearing Requirement and for which the index has been nominated as an alternative reference rate, please discuss a potential timeline for considering and adopting a modification and the reasons for adopting such timeline.

    CFTC requests that registered swap dealers and other market participants provide data related to market participants' outstanding net LIBOR risk as of November 30, 2021. In general, CTC requests comment on all aspects of the swap clearing requirement and any related regulations that may be affected by the transition away from LIBOR and the other IBORs to alternative reference rates. CFTC seeks comments on these matters generally and commenters are also encouraged to address any relevant matters that are not specifically identified in the requests for comment in this Federal Register notice. CFTC recognizes that, at this time, a majority of the swaps subject to the Clearing Requirement fall within the fixed-to-floating swap class. However, this may change as new alternative reference rates are adopted and will be characterized as OIS or other types of swaps. Among other factors, CFTC is seeking comments on whether it should designate any additional classes of swaps or specifications for purposes of classifying swaps under the CFTC regulation 50.4 or whether derivatives clearing organizations or market participants have suggestions about how to reorganize or structure the classes of swaps subject to the clearing requirement under this regulation.

     

    Related Link: Federal Register Notice

    Comment Due Date: January 24, 2022

    Keywords: Americas, US, Banking, Securities, Derivatives, Swaps, LIBOR Transition, Benchmark Reforms, LIBOR, IBORs, Alternative Reference Rates, Overnight Index Swaps, EONIA, Swap Clearing, CFTC

    Related Articles
    News

    BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks

    The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.

    March 13, 2023 WebPage Regulatory News
    News

    OSFI Finalizes on Climate Risk Guideline, Issues Other Updates

    The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.

    March 12, 2023 WebPage Regulatory News
    News

    BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending

    BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.

    March 03, 2023 WebPage Regulatory News
    News

    HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks

    The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.

    March 02, 2023 WebPage Regulatory News
    News

    BCBS Report Examines Impact of Basel III Framework for Banks

    The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.

    February 28, 2023 WebPage Regulatory News
    News

    PRA Consults on Prudential Rules for "Simpler-Regime" Firms

    Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.

    February 28, 2023 WebPage Regulatory News
    News

    DNB Publishes Multiple Reporting Updates for Banks

    DNB, the central bank of Netherlands, updated the list of additional reporting requests and published additional data quality checks and XBRL-Formula linkbase documents for the first quarter of 2023.

    February 28, 2023 WebPage Regulatory News
    News

    NBB Sets Out Climate Risk Expectations, Issues Reporting Updates

    The National Bank of Belgium (NBB) published a communication on climate-related and environmental risks, issued an update on XBRL reporting

    February 24, 2023 WebPage Regulatory News
    News

    EBA Updates Address Securitization Standards and DGS Guidelines

    The European Banking Authority (EBA) published the final draft of the regulatory technical standards that set out conditions for assessment of homogeneity of the underlying exposures in simple, transparent, and standardized (STS) securitizations.

    February 21, 2023 WebPage Regulatory News
    News

    FSB Publishes Letter to G20, Sets Out Work Priorities for 2023

    The Financial Stability Board (FSB) published a letter intended for the G20 Finance Ministers and Central Bank Governors, highlighting the work that FSB will take forward under the Indian G20 Presidency in 2023

    February 20, 2023 WebPage Regulatory News
    RESULTS 1 - 10 OF 8793