Deriv/SERV Trade Repository Update DTCC

Transcription

1 Deriv/SERV Trade Repository Update

2 Deriv/SERV: Early History Deriv/SERV, a subsidiary of DTCC established in 2003, operates as an at-cost, industry owned, utility provider. Focus on Post-Trade Processing Established in 2003 to provide electronic confirmation matching services to a heavily intensive paper backlog In 2006, service expanded to provide asset servicing on electronic contracts and facilitate settlement of payments known as Trade Information Warehouse (TIW) TIW maintains both electronically confirmed records and bespoke paper-based confirms represented electronically reflecting 99% of all CDS traded globally being housed in TIW Since 2008, TIW has been providing public aggregate reporting on a weekly basis on its public website 2

3 Public Reporting Further Explained Beginning November 2008, Deriv/SERV commenced weekly public reporting of transaction volume and aggregate positions for both cleared and un-cleared trades Stock Positions/Exposure Reports: These reports represents the exposure of the market as a whole to underlying reference entities including the top 1,000 single names, aggregation by various market sectors, and indices (tranched and untranched), shown by gross notional, net notional and number of contracts outstanding. Economic Turnover Volume (Flow Data): This report shows economic trading activity (e.g. price forming transactions such as new trades, assignments and terminations) in the market for single names and indices by gross notional and number of contracts outstanding. Industry Analysis Reports: Periodic analysis reports are produced for the industry for various purposes, e.g. liquidity analysis reports for indices comparing on-the-run and off-the-run, quarterly market activity analysis reports by clearing members of any clearinghouse against single names (Top 1000) and index volume, and to aide in the annual selection process for the CDS ISDA Determination Committee. DTCC Confidential (Yellow) 3 3

4 Deriv/SERV: Focus on Regulatory Transparency In 2010, DTCC launched its regulator portal - (currently subscribed by 41 regulators representing 22 countries) to provide data access In 2011, DTCC developed a global infrastructure to support trade regulatory reform In 2012, DTCC became a registered Swap Data Repository under CFTC regulations for Dodd Frank reporting for all 5 OTC derivative asset classes Credit, Equities, FX and Commodities. Real time price data made available on In April 2012, DTCC also registered in Japan with the JFSA as a trade repository In 2013, trade repository application pending with ESMA (Europe) and MAS (Singapore) 4

5 Regulator Portal Further Explained DTCC developed a regulator portal in 2010 pursuant to OTC Derivatives Regulator Forum (ODRF) guidelines which represents a group of regulators globally to address data access concerns. The regulator portal provides web-based access to weekly generated reports and daily transaction search data. The portal is entitlement-based and allows regulators to only view data where either the counterparty or the underlying reference entity is within their jurisdiction. Reports generated weekly include: Counterparty exposure report aggregated report of all open positions between bilateral counterparties for cleared and uncleared activity Reference entity exposure report aggregated report of all open positions by underlying reference entity for all particular jurisdiction for all counterparties. For example, a US underlying reference entity, where non-us firms have positions on the US underlier. This report allows the regulator to understand accumulation of risk by net exposure The regulator can then further dive into the transaction inquiry if they wanted to understand more about the trades that make up the position reflected in this report 5

6 DTCC Trade Repositories DTCC Trade Repository Companies DTCC Data Repository (U.S.) LLC ( DDR US a US company) DTCC Derivatives Repository Limited ( DDRL a UK company) DTCC Derivatives Repository (Japan) KK ( DDRJ a Japanese company) DTCC Derivatives Repository (Singapore) PTE. LTD. ( DDRS a Singaporean company) Asset Class Supported Credit, Equities, Commodities and FX Derivatives Credit, Equities, Commodities and FX Derivatives Credit, Equities and FX Derivatives Credit, Equities, Commodities and FX Derivatives Jurisdictions To Be Supported REGISTERED WITH CFTC United States Any other jurisdiction REGISTERED WITH FSA PENDING WITH ESMA Europe ODRF Any other jurisdiction REGISTERED WITH JFSA Japan REGISTRATION IN PROGRESS WITH MAS; ASIC WILL ALSO RECOGNIZE Singapore Any other jurisdiction Characteristics OTC Derivatives only; Real Time Price Public Dissemination; Regulator Reporting; Public Aggregate Reporting Only one party reports OTC and Listed Derivatives; Public Aggregate reporting; Regulator Reporting Both parties report OTC Derivatives (not including commodities) Regulator Reporting Only FIBOs report (both parties) OTC Derivatives (regulations pending)

7 Progress to Date ODRF (Voluntary) reporting Late 2009: Equity derivatives position based reporting launched. Further enhanced in 2012 to include transaction based reporting January 2010: Launched credit derivatives ODRF regulator reporting (98% of data held in TIW) November 2011: Added interest rate reporting (position based) CFTC Dodd Frank reporting September 2012: DDR received provisional registration to operate the swap data repository Launched SDR reporting on October 12, 2012 for Phase 1 (Credit and Interest Rates) reporting for cleared transactions December 31, 2012: Swap Dealers began reporting credit and interest rates. All active dealers reporting to DTCC January 10, 2013: Phase 2 for cleared reporting (FX, Commodities and Equities) February 28, 2013: Phase 2 for swap dealers completed April 10, 2013: Phase 3 end user onboarding processed (no action relief extended to August) JFSA trade repository designation received March 2013 reporting commenced April 1 ESMA and MAS application submitted pending designation