OTC Derivative Clearing: Navigating the New Regulatory Landscape

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Regulatory changes in the EU and US require OTC derivatives to pass through a clearing house, requiring organisational and technological changes.

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Regulatory developments in the EU and US will have a significant impact on the OTC derivative environment. Key changes will make central clearing and transparency mandatory to the OTC market along with capital requirement adjustments, as part of a global move to reduce systemic risk. This report illustrates a buyside and sellside perspective of OTC derivative clearing, offering an inside view on the effect of regulatory changes on trading and operations. Key observations are made of operational areas that will be affected by the move to clearinghouses, the expected growth in trades being centrally cleared, and the future of the OTC derivative trading environment.

This report offers a view on the newly emerging regulatory landscape in the OTC derivatives environment From a buyside, sellside and technology vendor perspective the areas affected and hurdles to compliance are determined.

Methodology
Buyside surveys of hedge funds, brokers, dealers, corporates and asset management firms provided for a bespoke analysis. Technology vendor interviews and the application of GreySpark consultancy experience bring unequivocal insight to industry actions in light of the new regulatory framework.

Published on: 26 Jan, 2012

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Description

OTC Derivative Clearing: Navigating the New Regulatory Landscape – Table of Contents

  • 1.0 Steps that Led to Regulation
  • 2.0 What is Central Clearing?
  • 3.0 Summary of Legislation
    • 3.1 European Union
    • 3.2 United States
    • 3.3 Global
    • 3.4 Summary of Key Points
  • 4.0 The New Framework
    • 4.1 The Future Flow for OTC Derivatives
    • 4.2 Anticipated Impact to the OTC Derivative Trading Environment
    • 4.3 Regulator Assistance
    • 4.4 Core Transaction Processing
  • 5.0 Implementation
    • 5.1 Changing Infrastructure
    • 5.2 Costs of Implementation
    • 5.3 The Cost of Doing Business
  • 6.0 Forward Perspectives
    • 6.1 Operational Risk
    • 6.2 Clearing Volumes
    • 6.3 Managing Margin
  • 7.0 Software Vendor Offerings
  • 8.0 Summary
  • 9.0 Appendices
    • 9.1 Dodd- Act: Highlights of the Legislations
    • 9.2 Dodd-Frank Act: Timetable of Events
    • 9.3 Basel III Schedule
    • 9.4 Organisations Surveyed by Type
    • 9.5 Table of Figures
    • 9.6 Glossary of Terms