CFTC Revamping Swaps Data Reporting
Keynoting the International Swaps and Derivatives Association’s public policy conference in Washington, D.C., CFTC Chairman Christopher Giancarlo took the opportunity to dispel the rumor that the US regulator was mapping its own course regarding swaps data reporting.
“Some reports suggest that the CFTC is moving in a direction at odds with the global efforts to develop uniform data standards,” said Giancarlo. “Let me assure you that those reports are incorrect.”
Although the CFTC’s Division of Market Oversight published a swaps data roadmap in July, it follows the work being done by the Committee on Payments and Market Infrastructures and the International Organization of Securities Commissions.
The CPMI-IOSCO process addresses what needs to be reported on a derivative but not when and how to report, according to Giancarlo. “We need to be sure that the when and how are also covered by our rules. In the end, the CFTC when and how rules for swaps reporting may be different than what is adopted by overseas regulators.”
The CFTC is co-leading various global initiative to harmonize reporting using unique transaction identifiers (UTIs) that tracks the lifecycle of a derivatives transaction; unique product identifiers (UPIs) that identify the instrument type and elements identified in the instrument; and critical data elements (CDEs) that provide essential terms of the transaction.
CPMI-IOSCO published final technical guidance on UTIs in early 2010 and Giancarlo expects that they will publish the final guidance on UPIs soon.
He also expects that final guidance on CDE fields will be available by the first quarter of 2018.
From the CFTC perspective, the DMO’s roadmap follows the international harmonization dates, but will provide a “more realistic timeframe for the rollout,” and include fields for jurisdiction-specific use cases, he added.
The CFTC has received approximately 20 comment letters since the roadmap’s release.
“I anticipate over the next nine months that the staff to present the Commission with recommended rule proposals with several areas of improvement. A major focus will be incorporating harmonize UTIs, UPIs, and CDE guidance into our reporting regime,” said Giancarlo.
Where the CFTC believes that it has the better approach, such as in single-side reporting, the regulator intends on pursuing its approach, he added. “Yet in other areas where, in light of experience, it appears that overseas regulators have adopted a better way, such as T+1 regulator reporting, we will consider adopting their rule sets.”
Regulator extends comment period to January.
Uncleared notional amounts keep falling ahead of UMR's extended Phase 5 deadline.
The new tool is set to support upcoming Phase 4 and 5 initial margin requirements.
Deutsche Bank and Nomura launched swaptions trading on the standardized infrastructure.
The vendor eyes easier interoperability with new toolkit.