Dealers welcome US uncleared margin rules

But cash variation margin restriction may upset the buy side

US Federal Reserve building

Dealers have welcomed the US banking regulators' proposal to restrict variation margin for uncleared swaps to cash only, but acknowledge that the buy side will be upset at being denied the ability to post bonds.

"Personally, I'm very happy about it and I think it makes an awful lot of sense. It will make the market and the business a lot healthier and it would circumvent a lot of discussions we have with financial institutions about credit support annexes (CSAs) because the discussion has been