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Frontloading rules for derivatives could harm pension funds – ISDA 

September 19, 2013
Cecile Sourbes, IPE

EUROPE – The International Swaps and Derivatives Association (ISDA) and the British Bankers Association (BBA) have called on the European Commission to exempt pension funds from frontloading obligations for over-the-counter (OTC) derivatives.

Responding to a consultation paper on clearing obligations under EMIR released by the European Market and Infrastructure Authority (ESMA) in July, the associations warned that lengthy frontloading periods would have a "detrimental" impact on the pricing of OTC contracts, which could in turn impact market participants, including pension funds.

'Frontloading' refers to the period between the point at which a central clearinghouse – also known as a central counterparty (CCP) – is authorised and the date on which the clearing obligation for a particular derivatives contract takes effect.

Read more: IPE

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