CCP Rule Book Changes on Settled-to-Market Model/Impact on Hedge Acctg

On January 4, 2017, ISDA’s Accounting Committee issued a confirmation letter to the Staff of Office of the Chief Accountant of the Securities and Exchange Commission (SEC) related to an ISDA whitepaper on the accounting Impact of central counterparty rule book changes. The SEC staff confirmed all the conclusions of the ISDA Accounting Committee outlined in the whitepaper and follow-up submission – namely i) that the changes to the rule books of LCH and CME, as supported by legal opinions from external counsel, should result in the presentation of variation margin amounts as settlement of the derivative exposure and not collateral against it for purposes of applying the accounting and presentation guidance in ASC 815 (US GAAP covering derivatives and hedging); and ii) that the de-designation and re-designation of existing hedging relationships under ASC 815 would not be required solely because of these changes to the respective CME and LCH rule books. ISDA recognizes the significance of the continued application of hedge accounting when the hedging derivative has been affected by these rule changes and its importance to clearing members and end users.

Joint Paper on UK EMIR Reform

On July 1, ISDA and UK Finance published a paper, which recommended a set of reforms for the UK European Market Infrastructure Regulation (UK EMIR), carefully considering each EU EMIR 3.0 reform and asking whether we would wish to adopt...

Response to FCA on UK EMIR Reporting

On June 30, ISDA submitted a response to chapter 5 of the UK Financial Conduct Authority’s (FCA) quarterly consultation CP25/16 on trade repository reporting requirements under the UK European Market Infrastructure Regulation (UK EMIR). Chapter 5 proposes ‘Amendments to the...

CDS Trading Activity in EU, UK and US Markets

This report analyzes credit derivatives trading activity reported in Europe. The analysis shows European credit derivatives transactions based on the location of reporting venues (EU versus UK) and product type. The report also compares European-reported credit derivatives trading activity to...