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Frontloading rules still a major concern despite delay 

May 14, 2014
Jonathan Watkins, FOW

The European Securities and Markets Authority (Esma) has recommended the mandatory clearing of certain OTC trades be delayed, possibly until around November this year.

Industry experts have told FOW however, that concerns still surround this introduction of frontloading relating to price differentials, valuations and operational risk.

With market participants growing increasingly concerned about the rules, some believe it should be scrapped altogether.

“Frontloading caused a lot of speculation and you could argue that it’s not needed at all,” said Hans-Ole Jochumsen, executive vice president, global market services for Nasdaq OMX.

“It’s interesting that the US tried to deal with this but shelved their plans and, so far, we’re the only region to consider it.”

Read more: FOW

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