Securities and derivatives market reform

G20 leaders agreed after the financial crisis that in the interest of financial stability they needed to reform the rules governing derivatives markets. In 2009, the G20 agreed to reforms to improve counterparty credit risk, bring greater transparency of pricing information and risk concentration, and shift as much over-the counter (OTC) trading as possible onto exchanges and electronic platforms.

As a result, new regulatory regimes governing derivatives markets have been implemented in major derivative dealing markets from 2012. Regulations such as the US Dodd-Frank Act, the EU’s European Market Infrastructure Regulation, and the review of the Markets in Financial Instruments Directive (MiFID II) require firms to develop significant “transformation” programmes, to become authorised (in some instances), and introduce new systems and processes for trading, settlement, collateral management, client money handling and reporting. The role of central counterparties and trade repositories, and changing capital requirements are also challenging the fundamental economics of traditional derivatives models.

Let us help you to navigate the changing regulatory landscape, bringing pragmatic approaches and solutions.