DerivAlert's Top 10 News Stories of the Year: 2013

| FinReg

There was no shortage of big news from the derivatives market this year.  In the month of October alone, the deadline for trading derivatives electronically on SEFs was met while the federal government implementing these regulations was shut down. Across the Atlantic, another group of regulators was lobbying for a delay in those rules, citing potential cross-border issues.  

Meanwhile, CFTC Chairman Gary Gensler, who announced that he will step down at the end of the year, held firm to his agency’s game plan.  And so, the new era of SEF-based OTC derivatives trading was born, as mandated by Dodd-Frank. 

Amidst all of the upheaval of the past year – the passed rules and agency guidance, the extended deadlines, uncertainty around extraterritoriality and the gridlock in Washington – which stories grabbed the most attention among DerivAlert readers?  To find out, we dug into the analytics to find out which posts were the most viewed over the course of 2013. 

Here they are, chosen by you, the DerivAlert reader:

The Top Stories of 2013 

(along with a few honorable mentions that we couldn’t resist including on the list):

10) EMIR Flaws Could See Futures Reporting Delayed Till 2015

By Tom Osborn

Published July 29, 2013, Risk

The European Securities and Markets Authority (Esma) has confirmed it is considering pushing back its trade reporting deadline for exchange-traded derivatives until as late as January 2015, in order to give firms more time to adapt the reporting framework to futures and options products.

full article  (subscription)

 9) Standardized OTC Swaps to Launch Within Weeks

By Peter Madigan

Published April 19, 2013, Risk

Within weeks, fixed-income market participants will be able to trade a new, exchange-traded version of the over-the-counter interest rate swap, with eight tenors, standard coupons and quarterly maturity dates like those used in the futures market. Some of those involved in the work see it as a way of defending the OTC market against the threat posed by swap futures.

full article  (subscription)

8) Uh Oh: The Attempt to Regulate Swaps is Failing

By John Carney

Published April 6, 2013, CNBC 

It's hardly surprising to hear that some of the largest derivatives brokerages are looking to set up futures exchanges. A huge portion of the traditional business these brokers did is in the process of migrating out of swaps and into futures.

full article  (free)

7) US in Compromise on Derivatives Trade Rules

By Michael Mackenzie and Gregory Meyer

Published May 16, 2013, Financial Times 

Commissioners on the US Commodity Futures Trading Commission voted 4 to 1 to pass long-awaited derivatives trading rules on Thursday that preserve voice-based transactions in conjunction with electronic platforms.

full article  (subscription)

6) SEF Rules Hit Non-US Cross-Border Trading

By David Wigan

Published October 31, 2013, Euromoney 

The requirement from October 2 for swap dealers and regular users of derivatives to transact swaps on Commodity Futures Trading Commission-mandated swap execution facilities (SEFs) was the last piece in the puzzle for US derivatives market regulation, after mandatory reporting and clearing came in earlier this year.

full article  (free)

5) Swaps Clearing Rules Divide Market

By Philip Stafford

Published August 21, 2013, Financial Times 

An obscure part of the Dodd-Frank Act has become the unwitting battleground among market infrastructure operators as they seek to meet rules tightening derivatives trading.

full article  (subscription)

4) SEF Execution Agreement Requirement Angers Buy-Side

By Peter Madigan

Published September 24, 2013, Risk 

Buy-side firms are refusing to sign participation agreements with some newly registered US swap execution facilities (Sefs), because of a controversial requirement that commits end-users to negotiate bilateral trade breakage agreements with any counterparty they transact with on the trading venues, Risk has learned.

full article  (subscription)

3) Traders Take Their Swaps Deals to Futures ExchangesBy Matthew Philips

Published January 24, 2013, Bloomberg Businessweek 

On Friday, Oct. 15, a rule designed to improve government oversight of the multitrillion-dollar market for derivatives took effect. The following Monday, many energy traders moved their swaps business to a futures exchange. After the U.S. Commodity Futures Trading Commission put two years into building its regulatory framework for swaps, a slice of the market simply sidestepped it.

full article  (free)

2) CFTC to Shake Up Swaps Trading Market

By Michael Mackenzie, Gina Chon, and Philip Stafford

Published November 17, 2013, Financial Times 

New guidance from the main US regulator of privately negotiated derivatives is set to test the business models of interdealer brokers, who have long played a crucial intermediary role between global banks.

full article  (subscription)

1) High Drama at the CFTC: The Battle Over Swaps and Futures

By Matthew Philips

Published February 1, 2013, Bloomberg Businessweek

Hearings at the U.S. Commodity Futures Trading Commission aren’t exactly known for their riveting entertainment value. Nor for their mass-market appeal. Yet on Thursday, it was standing-room-only at the CFTC headquarters in Washington as the commission held a roundtable discussion about the recent migration of swaps trading into the futures market.

full article  (free)

Honorable Mentions:

The Stories Made Us Stop and Say, ‘Whoa’

Three Wall Street Trade Associations Sue US Regulator

By Katy Burne

Published December 4, 2013, Wall Street Journal

Three Wall Street trade groups are suing a top U.S. regulator alleging procedural violations at the agency, in the latest effort by large banks to fight new rules that they contend will unfairly crimp their trading business.

full article  (subscription)

Wetjen Said to Face Vote as Acting CFTC Head Replacing Gensler

By Silla Brush

Published December 13, 2013, Bloomberg

Commodity Futures Trading Commissioner Mark P. Wetjen is poised to be voted acting chairman of the top U.S. derivatives regulator within days, according to two people with knowledge of the process.

full article  (free)

SEF MAT Submissions: Reality Check

By Radi Khasawneh

Published November 1, 2013, Tabb Forum 

Implementing the Made Available to Trade rule will transform the swap market. But based on early SEF submissions to the CFTC, the industry needs clarity on which swaps will qualify.

full article  (free)

Standardization Needed in SEF Reporting Conventions

By Michael Watt

Published October 25, 2013, Risk 

One of the core principles behind swap execution facilities (Sefs) – the new breed of trading platforms that opened for business under the US Dodd-Frank Act on October 2 – was to create greater transparency in the swaps market. In the words of the Commodity Futures Trading Commission (CFTC), Sefs must "make public timely information on price, trading volume, and other trading data on swaps to the extent prescribed by the commission".

full article  (subscription)

EMIR Reporting Questions Pile Up for Corporates

By Fiona Mawell

Published October 3, 2013, Risk 

Amid fundamental questions about the timing and scope of Europe’s new derivatives reporting rules, corporates are weighing whether to delegate the work to their dealers. But some large companies are not keen – and many banks are sitting on the fence. Fiona Maxwell reports

full article  (subscription)

Tags: FinReg, Blog , Regulation