IOSCO draws a few lessons from its s=consultation about strengthening the resilience of trading venuws through enhanced BCP testing, effective governance frameworks, managing dependencies on people, premises, processes... IOSCO report link: https://www.iosco.org/library/pubdocs/pdf/IOSCOPD694.pdf
ISDA publishes monthly updates on the OTC reform calendar, detailing all the forthcoming regulations by jurisdictions. This is a useful reminder of changes to come and dates to pay attention to. ISDA document: https://www.isda.org/a/vU6gE/Updated-OTC-Derivatives-Compliance-Calendar-2022-1-1.pdf
CFTC encourages the use of SOFR for ETD / XTD (EXchange Traded Derivatives) and makes 4 key statements: 1- Eurodollar futures and options are LIBOR contracts; --> so they should be abandoned 2- SOFR futures trading volumes are growing rapidly, and SOFR futures exposures are larger than market participants realize, given the construction of LIBOR [...]
ISDA publishes 3 documents for the Libor transition: - the 2021 Fallback Protocol - Amendments to Fallback Definitions and additional IBORs - New Fallbacks for Additional IBORs (India MIFOR; Malaysia KLIBOR; New Zealand BKBM; Norway NIBOR; Philippines PHIREF; Sweden STIBOR). ISDA Fallback Protocol: https://www.isda.org/a/nhtgE/ISDA-2021-Fallbacks-Protocol_Publication-Version.pdf New Fallbacks for Additional IBORs: https://www.isda.org/a/TltgE/ISDA-Publishes-New-Fallbacks-for-Additional-IBORs.pdf
The FSB issues its annual Report on the implementation of the OTC Derivatives Market Reform which was decided following the 2008/09 financial crisis. Nothing major has come out in the last 12 or 15 months, partly as a result of COVId-19. The FSB report can be found here: https://www.fsb.org/2021/12/otc-derivatives-market-reforms-implementation-progress-in-2021/
IOSCO completed its taskforce work on the supervision and regulation of commodity derivatives markets. The G20 had asked IOSCO to work on the regulation and supervision of commodity derivatives markets back in 2010, stressing the need “for enhanced transparency in both cash and derivatives markets as previously recommended by IOSCO”. In April 2011, the G20 [...]
The FCA Policy Statement specifies (and modifies) the derivatives clearing obligation in line with Article 5 of UK EMIR. FCA link: https://www.fca.org.uk/publications/policy-statements/ps21-13-libor-transition-and-derivatives-trading-obligation
AFME provided a response to the HMT consultation on the Wholesale Markets Review, providing feedback to the UK proposals on Trading Venues, SIs or Systematic Internalisers, Equity Markets - Fixed Income - Derivatives Markets - Commodity Market, Reporting... Access the AFME response here - https://www.afme.eu/news/press-releases/details/AFME-responds-to-UK-Treasury-Wholesale-Markets-Review
31/08/2021 ISDA stresses the need to have clear Implementing Regulations in place as soon as possible, to facilitate the transition or alternative arrangements, in particular for complex contracts. This is a recurring theme across jurisdictions, with a risk that legal disputes will derail a smooth transition. See the European Commission publication here - https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/13120-Interest-rates-Statutory-replacement-rate-for-the-EONIA-benchmark_en See [...]
12/08/2021 Adoption of RFR benchmarks in Derivatives is increasing slowly but surely… although there are huge disparities between GBP (high), USD and other currencies (low). Time is running out…. and the regulators are intensifying pressure on firms to progress towards the total eradication of references to Libor in all forms of contracts. See the publication [...]
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