Variation margin
WHAT IS THIS? Variation margin is a payment – typically made daily, in cash – to reflect changes in the market value of a trade, or portfolio of trades. In over-the-counter derivatives markets, variation margin is traditionally seen as a buffer against counterparty default; in listed derivatives, it is treated as settlement.
US, EU uncleared margin rules ‘impossible’ for Asia
US, EU insistence on next-day variation margin settlement criticised by Apac lenders
Europe set to delay variation margin regime
Delay to initial margin deadline likely to be accompanied by smaller shift in variation margin timetable
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
Regulatory intervention triggers complicate CCP resolution
Isda AGM: Role of supervisors will vary for each situation, say market participants
Standardisation ‘a must’ for uncleared swaps
Isda AGM: Standard products and contracts key to product's future, say trading execs
Mac swaps, swap futures face new tax threat
Isda urges US tax officials to postpone rule treating certain payments as loans
Questions remain after final EU uncleared margin rules
Industry gives a positive welcome, but the treatment of non-netting jurisdictions is still uncertain
Q&A: FDIC’s Hoenig warns on daily settled swaps
FDIC vice-chair on leverage-cutting schemes, TLAC and TBTF
Smaller firms get boost on timing for non-cleared margin
Counterparties will be able to offset extra collateral calls, says source close to EBA
US end-users risk tax hit in move to daily settled swaps
Changing treatment of variation margin could benefit banks, but hurt clients
EC urged to target initial margin for CCP recovery
Irish central banker says haircuts should be seen as temporary loans to CCPs in a crisis
Accounting puts brake on move to daily settled swaps
New margin approach threatens hedge accounting status, could hurt effectiveness
Buy-siders hope for late reprieve on margining for non-cleared swaps
National supervisors coming round to industry view on same-day settlement, say sources
Operational risk technology product of the year (buy side): CloudMargin
Clearing adds complexity for small buy-side firms; CloudMargin aims to take it away
Law firm of the year: Cadwalader, Wickersham & Taft
US law firm proposed relief to Tob programme, and won mandate to develop rule change
Fresh delay for EU rules on CCP spillover losses
Recovery and resolution rules will miss the revised February delivery date
US regulators told to expect VM status change
Fed, FDIC and OCC told daily settlement of swaps will cut required capital
Collateral or settlement: capital cut rests on role of VM
Questions about status of variation margin are more than semantics
Swaps CCPs hope to slash capital via margin change
Treating margin as settlement could cut leverage – CME, Eurex, Ice, LCH.Clearnet all seeking approval
Banks try to copy Citi and UBS clearing leverage cuts
Tactic slashes exposure for FCMs, but could undermine lobbyists
US margin rules threaten clearing bottleneck
Fed estimates $2.5 billion annual cost of funding margin on bilateral trades
EU regulators split over using initial margin to resolve CCPs
Rules on CCP resolution were due last month but are now slated for February
For a few dollars more: Japan banks tackle dollar/yen basis jump
Soaring cross-currency swap prices force dollar funding rethink
Massad: US to raise dollar threshold in uncleared margin rules
Higher final threshold may catch fewer firms