Regis-TR Readies for Derivatives Trade Reporting
Regis-TR, the European trade repository owned by Deutsche Börse and Spain’s BME, has doubled customers with access to its test system to more than 600 ahead of reporting starting in three months time.
Regis-TR was one of the first four trade repositories approved by The European Securities and Markets Authority this month. The registration took effect on November 14 with derivatives reporting due to start on February 12, 2014. Counterparties using an approved trade repository will meet their reporting obligations under the European Market Infrastructure Regulation.
David Retana, managing director of Regis-TR, told Markets Media that it had started testing in November last year and by July had more than 300 clients.
“The number of clients with access to the test environment is now more than 600 with about 15 joining every week,” he said. “Clients have increased since we received the license and we have signed more than 100 contracts including banks of significant size and central clearing counterparties.”
Retana said buy side customers are just signing up with one trade repository but banks will have to connect with a number of repositories to match their clients.
Regis-TR initially aimed to service small and medium-sized European corporates, who did not previously have to report trades, but its technology has also attracted larger banks and corporates. “Our model is focused on Europe and we have no intention of moving into other jurisdictions,” Retana added.
He said firms who have been testing with Regis-TR for months are prepared for the February deadline but those who are just starting may need to consider delegating reporting to a third party.
However he also warned there are still areas which need to be clarified by ESMA before February such as product identifiers and how to report complex trades. “We have holding meetings to discuss reconciliations between repositories as that has not proved very successful in the US and we want to avoid the same problems,” he added.
The reporting cover all five derivative asset classes — credit, interest rate, equity, foreign exchange and commodities – and Retana said there are significant differences between how foreign exchange trades are confirmed and how they need to reported. To solve this problem Regis-TR is liaising with Swift as the majority of foreign exchange trades are confirmed using Swift MT messages.
“We want to offer direct reporting for foreign exchange through MT messages. This is important for many corporates and small firms who are active in FX and would be the most straight forward for them,” Retana added.
He said commodities reporting could also be challenging as knowledge about energy markets is not widespread and some firms just trade specific asset classes.
“Most of the industry is very concerned about reporting listed derivatives due the lack of clear definitions. We will need guidance from Esma in the near future in order to accommodate the rules in our system,” Retana said.