The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

US and European Regulators Pledge to Work Together for CDS CCP Oversight

Last week potentially saw the beginning of the end of the row concerning the regulation of the credit default swap (CDS) central clearing counterparty (CCP) market with an announcement from the regulatory community that it is discussing cooperation and information sharing arrangements. During a meeting hosted by the Federal Reserve Bank of New York, regulators from the US and Europe indicated that they are open for further discussions concerning cross border standards and a consistent oversight approach.

The meeting followed an initial meeting held at the Fed on 12 January this year and included representatives from: the Commodity Futures Trading Commission (CFTC), UK Financial Services Authority (FSA), the German Federal Financial Services Authority (BaFin), Deutsche Bundesbank, the New York State Banking Department, the Securities and Exchange Commission (SEC), and the European Central Bank (ECB) and the Hungarian Financial Services Authority in their roles as co-chairs of the joint ESCB-CESR Working Group on Central Counterparties. These regulatory agencies currently have direct authority over one or more of the existing or proposed CCPs.

The discussions centred around mutual support between regulators and applying consistent standards and promoting consistent public policy objectives and oversight approaches for all CDS CCPs. It was decided that a further workshop would be organised for all parties to continue the discussions and find practical solutions to the oversight of the market.

The US market has witnessed an ongoing power struggle between the CFTC and the SEC over regulatory jurisdiction for the CDS market over the last six months and it is hoped that these discussions will put an end to this furore.

On the European front, last week, Banque de France also threw a regulatory spanner into the works with its proposals for a European led CCP in opposition to the UK and US led contenders. Given its interest in the market, it is likely that the French central bank will be invited to join in the discussions in the coming weeks.

Related content

WEBINAR

Recorded Webinar: Data management for ESG requirements

Environmental, Social and Governance (ESG) investing is moving into the mainstream, requiring asset managers to develop ESG strategies that deliver for both the firm and its investors. While these strategies can outperform those that do not include ESG factors, there is no clear route to success in an immature market that is only just beginning...

BLOG

ESG: The Next Frontier for Financial Services

ESG is everyone’s favourite topic right now, but the mass of different regulations, standards and reporting requirements can be confusing. Last week at the RegTech Summit Virtual 2020, we were delighted to speak with Beate Born, Head of Strategic Projects, Investment and Trading Platforms at UBS Wealth Management, to discuss how firms could best address...

EVENT

Data Management Summit Virtual

The Data Management Summit Virtual brings together the global data management community to share lessons learned, best practice guidance and latest innovations to emerge from the recent crisis. Hear from leading data practitioners and innovators from the UK, US and Europe who will share insights into how they are pushing the boundaries with data to deliver value with flexible but resilient data driven strategies.

GUIDE

Entity Data Management Handbook – Seventh Edition

Sourcing entity data and ensuring efficient and effective entity data management is a challenge for many financial institutions as volumes of data rise, more regulations require entity data in reporting, and the fight again financial crime is escalated by bad actors using increasingly sophisticated techniques to attack processes and systems. That said, based on best...