OCC Commends EC Extension of QCCP Deadline
OCC.com – CHICAGO – OCC, the world’s largest equity derivatives clearing organization, and a leading advocate for clearing equivalency on behalf of the U.S. listed options industry, today commended the European Commission for its decision to extend the deadline for CCPs to be deemed qualifying central counterparties (QCCP) until December 15, 2016.
OCC Executive Chairman Craig Donohue said, “We commend the European Commission for its decision to extend the transitional period deadline for CCPs such as OCC to be recognized as QCCPs. This announcement provides some important breathing room for the listed options industry. We look forward to continuing to work with the EC, the European Securities and Markets Authority, and the SEC as they work to come to an agreement on a common approach for the regulation of cross-border QCCPs.”
Donohue added, “Recognition of U.S. CCPs subject to the SEC’s jurisdiction is important to OCC and market participants for several reasons, foremost among them that it would allow EU banks’ and EU bank affiliates’ exposure to those CCPs to be subject to a lower risk weight in calculating their regulatory capital.”
OCC has said that its EU-affiliate clearing members’ risk weighted asset exposures to OCC would increase to over $75 billion from $924 million, requiring them to maintain additional capital of approximately $5.25 billion.
OCC is the world’s largest equity derivatives clearing organization and the foundation for secure markets. Founded in 1973, OCC operates under the jurisdiction of both the U.S. Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission (CFTC). OCC now provides central counterparty (CCP) clearing and settlement services to 19 exchanges and trading platforms for options, financial futures, security futures and securities lending transactions. More information about OCC is available at www.theocc.com.
Phase 5 of the uncleared margin rules (UMR) took effect from September 2021.
Temporary equivalence is set to expire on June 30 2022.
IRS trading volumes have fragmented without an equivalence agreement.
Phase 5 of the uncleared margin rules came into effect on 1 September.
Triparty repos can be executed across U.S. Treasury securities to central clearing.