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.
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.
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."
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.
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.
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.
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.
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."
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.