Amended Basel CVA rules get mixed reception | Senators suggest retaliation if EU backs off CFTC deal | Study: "Hard Brexit" could slam financial services
January 11, 2018
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Amended Basel CVA rules get mixed reception
The Basel Committee on Banking Supervision's amendments to rules on calculating the capital charge for credit valuation adjustment have generated a mixed response from dealers, who say the changes little improve the first version. The amendments allow two methods of calculation and better recognition of hedges, but critics say they are still too conservative and entail a heavier capital burden.
Risk (subscription required) (1/11) 
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Senators suggest retaliation if EU backs off CFTC deal
If the EU does not fully comply with a deal made with the US on mutual recognition of derivatives-clearinghouse oversight, the Commodity Futures Trading Commission should consider retaliation, two senators say. Senate agriculture committee Chairman Pat Roberts, R-Kan., and Sen. Debbie Stabenow, D-Mich., have written CFTC Chairman J. Christopher Giancarlo to say they will support him if he retaliates.
MLex (subscription required) (1/9) 
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Industry News and Trends
Study: "Hard Brexit" could slam financial services
A lack of a Brexit deal could mean the UK loses nearly a half-million jobs over 12 years, with financial and professional services faring the worst, losing as many as 119,000 positions, according to a study by Cambridge Econometrics commissioned by London Mayor Sadiq Khan. The study notes "the harder the Brexit, the more severe the economic damage could be."
Bloomberg (free registration) (1/11),  The Guardian (London) (1/11),  Reuters (1/11) 
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May plans Brexit meeting with financial execs
May plans Brexit meeting with financial execs
May (WPA Pool/Getty Images)
British Prime Minister Theresa May is meeting with chairmen and CEOs of major financial firms today to discuss a Brexit deal covering financial services. Executives from Aviva, Barclays, HSBC and Prudential are expected to participate, along with Chancellor Philip Hammond.
Reuters (1/10),  Sky News (1/10),  Politico Pro (subscription required) (1/10) 
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Merkel spokesman: Germany against Brexit financial-services deal
Merkel spokesman: Germany against Brexit financial-services deal
Merkel (Michele Tantussi/Getty Images)
The German government doesn't support a special Brexit deal to give UK financial-services firms continued free access to the European single market, says Steffen Seibert, a spokesman for German Chancellor Angela Merkel. Germany's focus is on maintaining unity among countries remaining in the EU, Seibert says.
Deutsche Welle (Germany)/Deutsche Presse-Agentur/The Associated Press/Reuters (1/10) 
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E-trading of European rate swaps up under MiFID II
Tradeweb's European interest-rate swaps trading was more than 104% higher during the first five days of trading under Europe's revised Markets in Financial Instruments Directive than the daily average volume last year. "We saw an increase in electronic trading of mandated products under MiFID II," said Enrico Bruni of Tradeweb.
Reuters (1/10) 
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Expert warns about focusing on collateral to avoid crisis
Godfried De Vidts, director of European affairs at NEX Group, says "an excessive focus on simply piling up collateral as protection may not prove to be the right answer" to preventing another financial crisis.
Global Investor (subscription required) (1/11) 
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Regulatory Roundup
Quality concern has ESMA delaying MiFID II data release
The European Securities and Markets Authority is concerned about the quality of data received under the revised Markets in Financial Instruments Directive. ESMA is delaying publication of data until March, saying the "quality and completeness of the data does not allow for a sufficiently meaningful and comprehensive publication."
Futures & Options World (subscription required) (1/10),  Financial Times (tiered subscription model) (1/10) 
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Regulators reportedly to testify on bitcoin to Senate panel
The Senate banking committee will hear testimony on cryptocurrency risk from Securities and Exchange Commission Chairman Jay Clayton and Commodity Futures Trading Commission Chairman J. Christopher Giancarlo early next month, a source says. Concerns have emerged about a lack of regulation and a possible bitcoin bubble.
Reuters (1/11) 
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ISDA News and Events
ISDA Spotlight On: MiFID -- Conferences in New York and London
ISDA Spotlight On: MiFID -- Conferences in New York and London
ISDA will be holding full-day conferences on MiFID that will address where the markets are today and how the rules are expected to develop over 2018. There will also be discussion on the impact of the new rules for commodity derivatives markets, best-execution reporting of OTC derivatives and an analysis of the effects MiFID II has on cross-border from a global perspective. REGISTER: The Impact of Markets in Financial Instruments Directive (MiFID) on US Firms and Markets in New York on Jan. 30 and Markets in Financial Instruments Directive II/Regulation in London on Feb. 6
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