In his prepared for delivery to the International Swaps and Derivatives Association's regional conference in New York, Gensler said the CFTC is still developing the definitions of the terms within the OTC derivatives reform, including swap dealer and major swap participant. These changes to the derivatives market were contained in the Dodd-Frank Wall Street Reform and Consumer Protection Act, which President Obama signed into law on July 21.
Still, Gensler said the "statute is pretty specific," about who will be caught up by these new definitions. The more than 200 entities expected to seek registration as swaps dealers -- a designation that will subject them to new clearing and reporting requirements -- include global and regional banks, global bank affiliates, which are required under a provision of the new law
push out their commodities, equities and much of their credit default swap businesses, non-bank swap dealers currently offering commodity and other swaps and potential new market makers looking to become swap dealers.
He said the requirement for standardized swaps to trade on exchanges or swap execution facilities is expected to lead to 20 to 30 new entities registering as swap execution facilities or designated contract markets in addition to the 16 futures exchanges the CFTC already regulates.
And he said the law's requirement that standardized derivatives be cleared through central clearinghouses is expected to cause the number of registered derivatives clearing organizations to increase to 20 from 14.
The new law also sets up a new registration category known as swap data repositories that will require "robust record-keeping and reporting, including an audit trail, for swaps," Gensler said.
"It will be important that swaps data be collected not only when the transaction occurs, but also for each life-cycle event and valuation over its duration," Gensler said.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
