Regulators push for operations changes
The derivatives industry is facing regulatory demands to improve operations-related issues. In recent weeks, both the President's Working Group on Financial Markets (PWG) and the Financial Stability Forum (FSF) have pushed dealers to enhance the infrastructure for over-the-counter derivatives (see page 10).
Among the various recommendations was the setting of strict criteria on the accuracy and timeliness of trade data submission and resolution of trade matching errors. Additionally, the regulators called for the International Swaps and Derivatives Association's cash settlement protocol - introduced in 2005 - to be written into standardised credit derivatives trade documentation.
The industry is responding to the recommendations. In a letter sent to the Federal Reserve Bank of New York on March 27
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