Banks fear early rollout of EU margin rules for forex forwards

Industry calls on EC to clarify when foreign exchange forwards will be subject to variation margining

ec-eu-european-commission
Foreign exchange forwards might be first in scope of EU non-cleared margin requirements

A quirk in the drafting of the European Union's forthcoming bilateral margin framework for uncleared derivatives has left industry participants fretting that foreign exchange forwards could be subject to variation margining (VM) much sooner than expected – possibly even before the rules' official implementation date of September 1.

The wording of Article 39(6) of the European Supervisory Authorities' (ESAs) final draft Regulatory Technical Standards (RTSs) for the EU's non-cleared margin rules

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