The Standard Initial Margin for Uncleared Derivatives has been decided. This decision brings derivatives reform to the OTC markets. Such wide-scale changes cannot be understood within each business silo. MHDS' Integrated Training helps firms maximize all of the changes they've made. ...
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APPLES AND ORANGES BASEL III plans to apply the leverage ratio to all collateral, including initial margin on cleared derivatives transactions (cleared at a clearinghouse). Swap Market participants are looking at cost increases estimated at 60%. A decision such as this will mean sell side will...
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Confusion reigns in the Derivatives World: New terms and acronyms; Swaps Clearinghouses; This cheat sheet will clear up the confusion. ...
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Proposed Margin Rules Last month, US Banking Regulators presented a new proposal for the collection, calculation, and segregation of margin for bilateral derivatives. The new US proposals are quite different from their original 2011 proposal, in light of the BCBS/IOSCO issuance of their 2013 final policy framework on...
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Pre-Onboarding To-Do List There are many tasks that need to be completed to migrate swap positions to a clearinghouse. This article speaks of three items which should be decided and determine whether to onboard the position into a clearinghouse. At a minimum, these tasks will shed...
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Proposed Standardized Initial Margin Method (SIMM) released Monday ISDA proposed a Standard Initial Margin Method for uncleared derivatives. (Read ISDA's proposal for SIMM here.) Standardizing Initial Margin for derivatives makes a lot of sense. Each counterparty has to post the same good faith deposit. Managing the...
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The exact impact of increased collateral requirements as the derivatives market shifts from bilateral to cleared contracts is unknown but widely estimated. Moody’s has made a guess of $700 billion to $1.2 trillion, which doesn’t sound too outlandish. Initial Margin Requirements for Swaps Initial margin (expected to be...
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