U.S. seen delaying swaps rules for overseas banks - News and Current Events | futures.io
futures.io futures trading

Go Back   futures.io

> Futures Trading, News, Charts and Platforms > Traders Hideout > News and Current Events

U.S. seen delaying swaps rules for overseas banks
Started:June 13th, 2012 (09:07 PM) by kbit Views / Replies:179 / 0
Last Reply:June 13th, 2012 (09:07 PM) Attachments:0

Welcome to futures.io.

Welcome, Guest!

This forum was established to help traders (especially futures traders) by openly sharing indicators, strategies, methods, trading journals and discussing the psychology of trading.

We are fundamentally different than most other trading forums:
  • We work extremely hard to keep things positive on our forums.
  • We do not tolerate rude behavior, trolling, or vendor advertising in posts.
  • We firmly believe in openness and encourage sharing. The holy grail is within you, it is not something tangible you can download.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community. It's free and simple, and we will never resell your private information.

-- Big Mike

Thread Tools Search this Thread

U.S. seen delaying swaps rules for overseas banks

Old June 13th, 2012, 09:07 PM   #1 (permalink)
Elite Member
Aurora, Il USA
Futures Experience: Advanced
Platform: TradeStation
Favorite Futures: futures
kbit's Avatar
Posts: 5,839 since Nov 2010
Thanks: 3,275 given, 3,321 received

U.S. seen delaying swaps rules for overseas banks

WASHINGTON (Reuters) - The United States is considering giving U.S. and foreign banks more time to comply with costly new reforms related to their overseas swaps operations, according to three people briefed on the matter.

The Commodity Futures Trading Commission has drafted a proposed exemptive order that would delay for these players certain "entity level" swaps rules, including one that will mandate they hold a certain amount of capital to back their trades, these people said.

The delay would provide relief to the foreign banks that execute many trades with U.S. counterparties. It would also cover the foreign operations of major U.S.-based swap players such as JPMorgan Chase & Co (JPM) and Goldman Sachs Group Inc (GS), according to the people, who were not authorized to speak publicly.

The banking industry has said an overly broad regime from the CFTC might duplicate or conflict with the rules of foreign regulators, or put certain banks at a competitive disadvantage.

To qualify for the delay, foreign firms would need to register with the CFTC and submit to the National Futures Association a plan for complying with CFTC regulations or those of their home country regulator, the people said.

The delay is expected to last at least a year, but the language is still being finalized, the sources said. The CFTC has tentatively scheduled a vote on the measure for June 21, they added.

A CFTC spokesman declined to comment.

Players that get a "swap dealer or "major swap participant" tag will be required to back up their trades with more capital and collateral as mandated by the 2010 Dodd-Frank Act, which seeks to boost transparency and limit risk in the $708 trillion global over-the-counter swaps market.

Rules finalized in April will apply the costly "swap dealer" tag on firms with $8 billion or more in swaps transactions for most asset classes in a 12-month period, though that threshold will eventually drop.

Risky derivatives trading at overseas subsidiaries of firms such as insurer American International Group Inc (AIG) severely damaged the U.S. financial system during the 2007-2009 financial crisis and led to multibillion-dollar taxpayer bailouts.

Those bailouts, combined with JPMorgan's recently announced $2 billion-and-growing loss on a derivatives portfolio run out of London, have prompted some U.S. regulators and lawmakers to push for a swaps regime with broad overseas application.

The CFTC is hoping to put the order up for a vote at the same time as it considers proposed guidance on the international reach of U.S. swaps rules, the people familiar with the matter said.

That guidance will lay out which swaps rules apply to foreign entities and which transactions will be subject to U.S. oversight.

The draft exemptive order on the delay, which CFTC commissioners received last week, would grant relief until a year after the order or the international reach guidance is finalized, whichever comes sooner, the people said.

If passed, the order would also free overseas banks from complying with certain "transaction level" requirements such as margin rules for transactions with foreign counterparties, according to sources.

The foreign firms would still be required to report swaps data to "swaps data repositories," the people said.

Major Wall Street firms and banks dominate the derivatives market and have been widely expected to fall into the swap dealer category.

JPMorgan, Bank of America Corp (BAC), Citigroup Inc (NYS:C), HSBC Holding Plc (HSBA.L) and Goldman Sachs control 96 percent of cash and derivatives trading for commercial banks and trust companies as of December 31, according to data from the Office of the Comptroller of the Currency.

Large swaps market players are likely to have to register with the CFTC later this year.

Exclusive: U.S. seen delaying swaps rules for overseas banks - Yahoo! Finance

Reply With Quote


futures.io > Futures Trading, News, Charts and Platforms > Traders Hideout > News and Current Events > U.S. seen delaying swaps rules for overseas banks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Upcoming Webinars and Events (4:30PM ET unless noted)

An Afternoon with FIO trader bobwest

Elite only

NinjaTrader 8: Programming Profitable Trading Edges w/Scott Hodson

Elite only

Anthony Drager: Executing on Intermarket Correlations & Order Flow, Part 2

Elite only

Adam Grimes: Five critically important keys to professional trading

Elite only

Machine Learning Concepts w/FIO member NJAMC

Elite only

MarketDelta Cloud Platform: Announcing new mobile features

Dec 1

NinjaTrader 8: Features and Enhancements

Dec 6

Similar Threads
Thread Thread Starter Forum Replies Last Post
Bankers air fears over scope of swaps rules kbit News and Current Events 0 February 8th, 2012 07:26 PM
ECB Relaxes Rules on Some Collateral From Banks Quick Summary News and Current Events 0 September 21st, 2011 10:00 AM
Volcker Rule May Extend to Overseas Banks kbit News and Current Events 0 September 17th, 2011 12:22 PM
New Mortgage Rules Stricter Than Many Banks Had Hoped Quick Summary News and Current Events 1 March 29th, 2011 02:54 PM
Major Banks Under Pressure To Revamp Foreclosure Rules Quick Summary News and Current Events 0 March 5th, 2011 12:30 PM

All times are GMT -4. The time now is 09:34 PM.

Copyright © 2016 by futures.io. All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts

Page generated 2016-10-24 in 0.07 seconds with 19 queries on phoenix via your IP