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08 May 2017

ISDA AGM focuses on push for derivatives market efficiency

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With the G-20 derivatives reforms in place, there have been calls in the US and Europe to consider the various regulations implemented since the crisis to eliminate duplication and inconsistencies, and to reduce compliance challenges that add to costs without contributing to systemic-risk reduction.

A key driver is a growing political impetus to ensure the regulatory framework is able to support economic growth.

“The financial system is much more resilient and transparent as a result of the G-20 reforms, but there’s a growing consensus that the regulatory framework should be assessed in an effort to improve it further. That can be done by reducing complexity and removing unnecessary compliance burdens, achieving cross-border harmonization of capital and market rules, and conducting cumulative impact studies before all the rules take effect to assess their impact on the entire derivatives ecosystem,” said Scott O’Malia, ISDA’s Chief Executive.

A number of initiatives are already under way in Europe and the US, including a review of the European Market Infrastructure Regulation, the Commodity Futures Trading Commission’s (CFTC) Project KISS and the US Treasury’s regulatory review.

“At ISDA, we strongly support safe derivatives markets, and the industry has worked alongside regulators over the past eight years to make the system more resilient. But we also support efficient derivatives markets. Both are critical to a healthy financial system and a strong economy,” said Eric Litvack, Chairman of ISDA.

Full press release

© ISDA - International Swaps and Derivatives Association

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