ESMA declines SFTR amendment – What happens next?
On 4 September, ESMA formally rejected the European Commission’s (EC) request to make minor amendments to its draft SFTR level II legislation. ESMA delivered this news in the form of a formal opinion with an accompanying covering letter. The “turf war” that we discussed previously continues. We were tempted to analyse the detailed legal argument […]
Protected: BREXIT Bombshell to hit Financial Industry – EMBARGOED STORY
There is no excerpt because this is a protected post.
SFTR – Commission will adopt ESMA’s RTS/ITS BUT…
For many months we have been writing both publicly and privately to our clients inviting them to ignore industry gossip about a greatly changed SFTR being privately concocted by the Commission (EC). We have posited that firms really do need to crack on as the draft level II legislation will not change in any significant […]
SFTR – Enforcement Action against the EU Commission
With regret, we announce we have commenced action against the European Commission (EC) for its failure to adopt or otherwise the SFTR RTS (regulatory technical standard) as ESMA presented to them on 31 March 2017. We previously explained the basis for action and had sought to engage privately with the EC but they have refused […]
SFTR – Commission delays RTS adoption. But is it legal?
How long does the EU Commission legally have to adopt a regulatory technical standard (RTS)? Specifically, how long does the Commission have to adopt the SFTR RTS given that they received it over a year ago. This article will present Market FinReg’s views. Disclaimer: This is a matter of considerable public interest and represents […]
FSB delivers Global Shadow Banking Monitor 2017
In my book SFTR: A Survival Guide[i], I explained the importance of monitoring FSB shadow banking reports if one is to truly understand the essence of SFTR: As recitals 2-7 of SFTR acknowledge, the FSB’s reports have been instrumental in fashioning the EU’s SFTR legislation. Indeed, SFTR is the EU’s implementation of FSB recommendations (‘this […]
SFTR – Collateral Reuse (rehypothecation)
Collateral Reuse – PILLAR III Reuse of collateral provides liquidity and enables counterparties to reduce funding costs. However, it tends to create complex collateral chains between traditional banking and shadow banking, giving rise to financial stability risks… Reuse should take place only with the express knowledge and consent of the providing counterparty. SFTR[I] Principle […]
What is SFTR? A Whirlwind Tour of the 3 Limbs
What is SFTR? SFTR: Security Financing Transactions Regulation. Formally, Regulation (EU) 2015/2365…on transparency of securities financing transactions and of reuse and amending Regulation (EU) No 648/2012. It was adopted on 25 November 2015. SFTR is built on three pillars[i]: Transaction Reporting. Requirements for counterparties to SFTs to report all SFTs to central trade repositories; […]