New CDS index delayed by regulatory capital concerns

Dealer worries about impact of self-referencing trades derail CDX Financials launch at last minute

Wall-Street-red-light

S&P Global-owned IHS Markit has postponed the launch of a new credit default swap (CDS) index days before it was set to start trading after dealers raised concerns that regulatory capital rules would keep them from using the product.

In a statement on Friday, May 31, the index’s administrator wrote that CDX Financials – the highly anticipated index of banks and insurance companies – would not begin trading on Monday, June 3 as planned, citing “regulatory concerns raised by multiple market-makers”

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