Regulatory attacks deal BSBY swaps a crippling blow

Libor successor “dead in the water” but CME sticks with cleared swap plan

Future-looks-bleak-for-BSBY

Swaps tied to Bloomberg’s Short-Term Bank Yield index face a bleak future as a barrage of regulatory attacks have crimped trading and cast doubt on the rate’s long-term viability.

Just five months since the first BSBY swaps traded to great fanfare, the nascent market is faltering. Traded notional in the instruments totalled just $1 billion in September, according to data from the Depository Trust & Clearing Corporation’s (DTCC) Global Trade Repository. While that is double the volume in August

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