Financial Regulatory Forum

SCENARIOS-Three routes to swaps reform in U.S. Congress

WASHINGTON, March 16 (Reuters) – The path to government regulation of the $450 trillion market in over-the-counter derivatives must wind through the U.S. Senate Agriculture Committee, which oversees futures markets.

The journey began in the House of Representatives in December with the passage of a bill that would bring OTC derivatives under government regulation for the first time.

The Senate Banking Committee is also involved. A bill unveiled on Monday by its chairman calls for new rules for the market, which is dominated by a handful of Wall Street firms, including Goldman Sachs and JPMorgan Chase.

The Obama administration and most congressional Democrats favor an OTC derivatives crackdown, with many Republicans on board as well. But Wall Street lobbyists keen to protect the substantial profits produced by derivatives trading are pushing to write loopholes and exemptions into the new regulations.

There is wide consensus among lawmakers to require mandatory clearing and exchange trading of standardized derivatives. Trading of customized swaps would be reported, with the expectation of higher margin and capital requirements.

US lawmakers urged to drop clearinghouse ownership cap

U.S. Representative Barney Frank (D-MA) holds a news conference on issues before the House Financial Services Committee on Capitol Hill in Washington, November 3, 2009.  REUTERS/Jonathan Ernst   By Jonathan Spicer
NEW YORK, Nov 20 (Reuters) – NYSE Euronext, LCH.Clearnet, BATS Global Markets and other firms partnered with banks have urged two U.S. legislators to drop a proposed “rigid” cap on dealer ownership of clearinghouses, according to a letter sent this week.

(more…)

US Sen Dodd to remain banking panel chairman – aide

WASHINGTON, Sept 9 (Reuters) – U.S. Senator Christopher Dodd will remain chairman of the Senate Banking Committee and not take over the health committee after the death of his friend, Senator Edward Kennedy, a Senate aide said on Wednesday.

By staying at banking, Dodd will prevent potential further delays in an already bogged-down push by Democrats to tighten regulation of banks and capital markets in response to the 2008-2009 financial crisis, the worst in decades.

(more…)

COLUMN-Commodity trading faces altered landscape: John Kemp

– John Kemp is a Reuters columnist. The views expressed are his own –

By John Kemp
LONDON, Aug 5 (Reuters) – While the U.S. Commodity Futures Trading Commission (CFTC)’s current review of energy markets is likely to result in only modest changes to the formal regulatory framework, centred on tougher position limits and enhanced reporting, the political landscape for commodity trading has changed profoundly.

(more…)

U.S. House ‘concept paper’ has mandatory OTC derivatives clearing

WASHINGTON, July 29 (Reuters) – The leaders of the two U.S. House committees overseeing U.S. securities and futures markets agree that over-the-counter derivatives should move onto regulated exchanges and go through clearing in most cases, according to a “concept paper” that will guide bill-drafting.

(more…)

U.S. finance reform bill may ban ‘naked’ credit default swaps

U.S. Rep. Collin Peterson WASHINGTON, July 21 (Reuters) – An omnibus financial reform bill in the U.S. House of Representatives would require that over-the-counter derivatives go through clearinghouses and probably ban “naked” credit default swaps, the chairman of the House Agriculture Committee said on Tuesday. (more…)

  •