European swap margin rules won’t be retroactive, says Esma

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European rules on the margining of over-the-counter derivatives will not be applied to trades completed before the new regime comes into force, the European Securities and Markets Authority (Esma) has told Risk. The clarification has come as a relief to dealers that feared existing swaps would be ‘front-margined' – changing the economics of trades part-way through their life and potentially rendering them unprofitable.

"It would have killed some trades," says one derivatives trader at a European

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