The European Banking Federation, among other respondents, believes that the basic function of a TR consists in reporting and forwarding collected data. Potential additional functionalities for life cycle events handling are not essential.
The European Banking Federation, among other respondents, believes that the basic function of a TR consists in reporting and forwarding collected data. Potential additional functionalities for life cycle events handling are not essential.
The London Stock Exchange believes it is important to make clear that for any system of trade repositories to be fully effective, a critical part of the exercise will be determining the requirements for the system and processes to be applied in collecting and analysing the information. Material submitted to a TR must be in a standard, consistent format, capable of being interrogated and delivering meaningful and comprehensive reports and analysis, in much the same way (albeit even more complex) as the standardisation that will be required for clearing OTC products. Without this, the ability of regulators to build their understanding of the market will be compromised.
Background on the Consultation:
The financial crisis, especially the default of Lehman Brothers, underlined the importance of a robust and adequately functioning post-trading infrastructure, highlighted the need for more transparency on exposures generated by the over-the counter (OTC) market, in particular for derivatives, notably credit default swaps (CDS), and demonstrated the need to safeguard the OTC market from abusive behaviour.
The CESR/ESCB Recommendations for Securities Settlement Systems and Central Counterparties in the European Union, upon request of the ECOFIN, have been reviewed in order to encompass the OTC derivatives dimension. On 31 July 2009 the European Commission announced a major step towards financial stability for the European CDS market in (defined as the market in CDS that reference European entities and indices), related to European entities and indices will be cleared through central counterparties as of that date. The fact that various providers of clearing services have now expanded (or are in the process of doing so) their scope of services to central clearing of CDS is an important reason to consider what further improvements can be made in order to enhance risk mitigation and to improve the transparency and efficiency of the post-trading process as a whole. On 3 July 2009 the European Commission published a Communication on ensuring efficient, safe and sound derivatives markets. In the Communication the Commission referred to the forthcoming report of CESR on trade repositories, on the basis of which the Commission will take appropriate actions. It also raised several other issues that it considers to be important in the context of derivatives markets.
© CESR - Committee of European Securities Regulators
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article