The FSB requested further study of how to ensure that the data reported to TRs can be effectively used by authorities, including to identify and mitigate systemic risk, and in particular through enabling the availability of the data in aggregated form. The FSB, in consultation with the Committee on Payment and Settlement Systems (CPSS) and the International Organisation of Securities Commissions (IOSCO), will then make a decision on whether to initiate work to develop a global aggregation mechanism and, if so, according to which type of aggregation model and which additional policy actions may be needed to address obstacles.
FSB‘s public consultation paper responds to the request by the FSB for a feasibility study that sets out and analyses the various options for aggregating OTC derivatives TR data. The paper discusses the key requirements and challenges involved in the aggregation of TR data, and proposes criteria for assessing different aggregation models. Following this public consultation and further analysis by the study group, a finalised version of the report, including recommendations, will be submitted to the FSB in May 2014 for approval and published thereafter.
The public consultation paper examines the three broad types of model for an aggregation mechanism: a physically centralised model; a logically centralised model; and the collection and aggregation by authorities themselves of raw data from TRs. Within these three broad types of model, a variety of detailed alternatives exist that would provide differing levels of sophistication of service. These alternatives would need to be examined further in the final report in May and in any follow-on work that may be commissioned to take forward one of models following this feasibility study.
The paper analyses the key factors and challenges associated with the three models, taking into account the range of needs of authorities for aggregated data across TRs and focusing on those considerations that are most relevant to the potential choice of model. It divides these considerations into two types:
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legal considerations, including those relating to submission of data to the aggregation mechanism, access to the mechanism, and governance of the mechanism: and
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data and technology considerations, including those related to data standardisation and harmonisation, data quality, information security, and other technological considerations.
Based on this analysis, the paper proposes a set of criteria to be used in order to provide a common and systematic structure for the assessment of the options in the final report. The FSB wishes to have feedback via public consultation process on these considerations and criteria before proceeding to the assessment itself. Responses should be sent by Friday 28 February.
Full press release
Consultation paper
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