Industry Warns Over Failure to Reach EU-US Deal on Derivatives – Reuters
Failure by European Union and US regulators to iron out differences in their derivatives rules would prompt “catastrophic” attempts by market users to pull out from American clearing houses, a senior industry official has warned.
Trading Firms Want More Clearing “Skin in Game” – FOW (subscription)
European clearing members have called on clearing houses to increase their default fund contributions or “skin in the game” to take into account the increased risk brought to the system with the addition of new products and classes of clearing members.
No Consensus Over Stopping Clearers Becoming ‘Too Big to Fail’ – Reuters
Banks and mutual funds have no way of comparing the health of clearing houses for derivatives just months before their use becomes mandatory in Europe.
CCP Stress Tests Could Help Buy Side Pick Winners – Risk Magazine (subscription)
Making comparisons between clearing houses is “incredibly difficult”, and standardised stress testing should be enforced to help asset managers make an educated choice in the run-up to mandatory clearing in Europe, according to Stuart Anderson, director of electronic and market structure at BlackRock.
Fintech Upstarts Target Financial Terminal Business – Profit & Loss (subscription)
Technological advancements have led to new vendors attempting to disrupt the financial terminal business. Will they be able to challenge the incumbents?
Illiquidity Means Some Hedges Are No Longer Possible – Risk Magazine (subscription)
Corporates are finding it harder to find liquidity in the over-the-counter derivatives market, forcing some to cut back on their hedging activities, according to a derivatives lawyer at General Electric.
EU Watchdog Says Too Soon to Intervene on Market Liquidity – Reuters
Several factors affect market liquidity and it was too early to consider regulatory intervention, the European Union’s top securities supervisor said on Tuesday as its US counterpart proposes new rules.