United Kingdom (UK)
In euro swaps tug of war, EC considers Eurex trading quota
European Commission may force firms to channel minimum amount of swaps activity to EU clearing house
Barclays’ risk pare-back sees market RWAs fall £3bn
The majority of market risk is now assessed under the regulator-set standardised approach
Defiant ECB urges ‘further work’ on clearing relocation
Policy-makers moot changes to Emir to tackle systemic risks of third-country CCPs
Buy side divided on euro swap clearing move
With eurocrats dithering on extension of LCH waiver, asset managers mull when – or if – to jump ship to Eurex
People moves: Citi nabs JPM and Citadel staff, and more
Latest job changes across the industry
China, Turkey lead regulatory laggards on Basel III framework
Argentina, Australia, Brazil, Japan and Korea made no progress at all since May 2020
Some hedge funds are financing trades for other hedge funds
After the Archegos collapse, hedge funds are competing to borrow money from a dwindling number of banks
Inflation swap stampede stirs fears of lopsided market
Soaring demand for inflation hedges leaves dealers struggling to balance exposure
Synthetic Libor gets cautious approval as swaps fix
‘Tough legacy’ solution could mop up $2.7trn-equivalent of non-cleared sterling and yen derivatives
UK bank LCRs fall in Q2, led by HSBC
Implementation of new methodology weighs on bank’s end-quarter LCR
Euro swaps relocation stalls as equivalence deadline nears
Nine months before equivalence deadline, over 70% of EU euro swap trades still clear in the UK
BSBY swap fallbacks too flimsy for BMR – FCA
Pressure piles on SOFR alternative as US, UK regulators axe their role in Isda replacement waterfall
Sonia/SOFR swaps jump ahead of ‘RFR First’ initiative
Cross-currency swaps increasingly seeing RFRs on both legs
Amundi, Axa urge boardroom pay cuts for climate laggards
Link remuneration to carbon-emission goals and companies will get serious, say large investors
StanChart’s CVA charge up 19% in Q2
Higher capital requirements also at Barclays, Lloyds and NatWest, with HSBC the only outlier among top UK banks
Level 3 assets at global systemic banks down 36% since 2014
Hard-to-value holdings down sharply over the past six years, but pandemic threw spanner in the works at some banks
UK bank derivatives exposures fall by £321bn in Q2
At £1.12 trillion, FX exposures are at their lowest levels for seven years
Opt in or opt out: an FX class action decision worth millions
Six banks accused of manipulation may see 40% reduction in damages if UK lawsuit proceeds along ‘opt-out’ route
BoE floor could double capital charges on HSBC’s UK home loans
New rules could forcibly push up residential mortgage portfolio’s 5% risk density
How to trade like the investor who made $1bn in a day
Mark Spitznagel won’t reveal how he made a 4,144% return, but he does discard plenty of rival trades
40% of insurers fail to specify climate as a key risk – LCP
Despite regulators’ urging, many UK and Irish insurers omit climate from risk statements, says report
The unintended consequences of ring-fencing
Rules aimed at protecting UK depositors may be putting too much froth into the credit market
Safety first: UK set to keep ring-fencing but may ease rules
There is also pressure to make changes to tackle banks’ overexposure to retail debt due to the rules
Archegos report details margin failings at Credit Suisse
Dynamic margining and a $150,000 software fix for ‘bullet swaps’ could have saved the bank $3 billion