Tue, Dec 23, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

CFTC adopts new rules on cleared swaps collateral segregation

Friday, March 09, 2012

Bailey McCann, Opalesque New York - The Commodity Futures Trading Commission (CFTC) has adopted a new slate of final rules concerning collateral segregation for cleared swaps. Futures commission merchants (FCMs) and derivatives clearing organizations (DCOs) will now be required to segregate collateral posted by customers on cleared swaps. The rule changes are part of the regulator's efforts to comply with the requirements set forth in the Dodd-Frank Act.

The new rules will go into effect on April 9, 2012 but market participants will have until November 8, 2012 to be fully compliant.

Under the terms of the new rules, FCMs and DCOs must segregate cleared swap customers collateral on their books and records and cannot comingle customer collateral with their own funds. Customer collateral may only be comingled with other customer funds. The new rules also restrict derivatives clearing organizations from using non-defaulting customer collateral to cover the obligations of defaulting customers.

The changes are designed to reduce "fellow-customer risk," but will have an impact on the cost of entering into cleared swap transactions. Futures commission merchants and derivatives clearing organizations will likely bear the biggest brunt in terms of cost to implement these new rules as they require significant operational changes for both groups.

According to a ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Hong Kong-Shanghai stock link fails to live up to expectation so far[more]

    Komfie Manalo, Opalesque Asia: In a report, Reuters said that demand has been subdued with the bulk of activities coming from short-term speculative investors. Las

  2. Investing - Hedge funds get boost from healthcare in 2014, Paulson & Co takes stake in Salix on heels of inventory issues[more]

    Hedge funds get boost from healthcare in 2014 From Valuewalk.com: The healthcare sector started the year on a turbulent note, as stocks of many major biotechnology companies were battered. However, most of the players in this sector have bounced back. The BarclayHedge Healthcare & Biotec

  3. North America - Why Steve Cohen, Connecticut hedge fund billionaire, gives so much in New York[more]

    From Insidephilantrophy.com: Billionaire Steve Cohen was born in Great Neck, New York before attending Wharton, working on Wall Street and then founding SAC Capital Advisors in Connecticut. Though his company (Point72) and foundation are based in Connecticut, Cohen and Alexandra are deeply connected

  4. Investing - Soros buys a highly speculative biotech in the third quarter[more]

    From Fool.com: …The Soros Fund bought 25,000 shares of the struggling small-cap biopharma Aegerion Pharmaceuticals in the third quarter. For those of you who haven't heard of this name, suffice to say that this was a surprising buy in light of the company's recent problems and poor outlook going for

  5. CFTC Revokes Registrations of Illinois Resident Aleks A. Kins and Chicago-based AlphaMetrix, LLC[more]

    Matthias Knab, Opalesque: The U.S. Commodity Futures Trading Commission (CFTC) today announced that it has revoked the registration of Aleks A. Kins of Chicago, Illinois, as an Associated Person and the registrations of AlphaMetrix, LLC (AlphaMetrix), a Delaware limited liability company with its