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Commodity Portfolio Management Research & Reports

SEF Volumes Reach Record Highs as Made-Available-to-Trade Determinations Set In

London, 9 April 2014

TABB Group sees signs of buy-side firms both adopting and avoiding Swaps Execution Facilities (SEFs) since mid-February when Made-Available-to-Trade (MAT) determinations went into effect, now seen driving SEF volumes to record highs. 

Read more: SEF Volumes Reach Record Highs as Made-Available-to-Trade Determinations Set In

OTC Derivatives Regulations and Swap Execution Facilities

London, April 2014

With the Dodd-Frank rule for certain swaps to be mandatorily traded on Swap Execution Facilities (SEFs) becoming effective, a new survey finds that the industry remains  underprepared to meet the requirements of  these new regulations, while individual firms push ahead to make themselves ready. This survey, released today and conducted by IPC Systems, Inc., a leading provider of voice and electronic trading communications solutions to the world’s top financial services firms and global enterprises, highlights the state of the industry’s preparedness for this new SEF model and potential impact on the OTC derivatives markets.

Read more: OTC Derivatives Regulations and Swap Execution Facilities

FSB publishes reports on implementation of OTC market reforms

London, 8 April 2014

G20 Leaders agreed in 2009 to a comprehensive reform agenda for these markets, to improve transparency, mitigate systemic risk, and protect against market abuse.

To achieve these objectives, the G20 has agreed that:

  • all OTC derivatives contracts should be reported to trade repositories (TRs);
  • all standardised contracts should be traded on exchanges or electronic trading platforms, where appropriate, and cleared through central counterparties (CCPs);
  • non-centrally cleared contracts should be subject to higher capital requirements and minimum margining requirements should be developed.

The report published today finds that substantial progress has been made toward meeting the G20 commitments, through international policy development, jurisdictions’ adoption of legislation and regulation, and expansion in the use of market infrastructure.

  • Jurisdictions’ implementation of reforms: More than three-quarters of FSB member jurisdictions have regulations in place to require transactions to be reported to trade repositories. Frameworks for central clearing requirements are in place in jurisdictions with the largest derivatives markets, with some specific mandatory clearing rules now in effect. Although legislative frameworks are in place to support increased use of exchanges and trading platforms for OTC derivatives contracts, where appropriate, there continues to be differences across jurisdictions in their approaches and timing of implementation in this reform area.
  • International standards: Key international policy standards have already been finalised in most commitment areas and work on the few remaining standards is on track to be finalised by end-2014 or earlier; these include capitalisation of banks’ central counterparty exposures, recovery and resolution of financial market infrastructures and risk mitigation standards for non-centrally cleared derivatives.
  • Effective implementation of reform will need satisfactory resolution of cross-border regulatory issues. A group of regulators from a number of large OTC derivatives markets (the OTC Derivatives Regulators Group) have reached additional understandings to improve the cross-border implementation of OTC derivatives reforms.

The report also discusses areas where further work is needed to complete the reforms and achieve the G20 objectives, including for authorities to:

  • put in place their remaining legislation and regulation promptly and in a form flexible enough to respond to issues of cross-border consistency and other issues that may arise;
  • provide clarity on their processes for making equivalency or comparability decisions (including whether additional authority may be needed to defer to other jurisdictions’ regimes, where appropriate) – the FSB will report to the G20 by September on jurisdictions’ frameworks in this regard; and
  • continue to closely coordinate and cooperate as needed to promptly seek to resolve cross-border regulatory issues when they are identified.

The FSB will continue to monitor jurisdictions’ implementation of the OTC derivatives reform programme, as well as the extent to which the implemented reforms meet the G20’s underlying goals of improving transparency, mitigating systemic risk, and protecting against market abuse. The FSB will publish its next progress report ahead of the November G20 Leaders’ Summit.

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Download the Report Below:

The FSB welcomes feedback from the public on this report. Feedback should be submitted by 8 May 2014 by e-mail ( This email address is being protected from spambots. You need JavaScript enabled to view it. ) or post (Secretariat of the Financial Stability Board, c/o Bank for International Settlements, CH-4002, Basel, Switzerland). Feedback  will  be posted on the FSB website unless respondents request otherwise.

Investment update on the situation in Crimea

London, 19 March 2014

Baring Asset Management: In our view, the geopolitical tensions surrounding the situation in Crimea, the Russian response and the consequent sanctions imposed by Western nations present an increasing source of risk within the global economy.

Read more: Investment update on the situation in Crimea

Relief for documentary credits under Basel III Leverage Ratio

London, March 2014


The Basel III Leverage Ratio has been amended following the Basel Committee on Banking Supervision’s recent publication of its paper, “Basel III Leverage Ratio Framework and Disclosure Requirements”.



Read more: Relief for documentary credits under Basel III Leverage Ratio

New Regulations Impacting Business Functionality Across Europe

Stockholm, February 2014

An Infiniti Research survey sponsored by TradeTech Consulting Scandinavia AB, a Virtusa, Swedish subsidiary; reveals that the numerous regulations currently being enforced in Europe’s financial markets have considerable impact on business functionality. Beginning 2011, European financial markets have witnessed an upsurge of regulations such as the Foreign Account Tax Compliance Act (FATCA), the Basel III Capital Requirements and the Markets in Financial Instruments Directives (MIFID). The Infiniti Research survey aimed to understand the influence and impact of these regulations on various factors such as business operations, technological developments and types of funding.  

Key findings:

  • 90% of the respondents were of the opinion that the regulations implemented in Europe’s financial markets had an impact on the cost structure of the business operations.
  • 100% indicated that they would adopt measures to improve operational efficiency, in order to reduce high operational costs.
  • 80% indicated that the regulations are expected to revolutionise the usage of IT in business operations.

Joakim Wiener, CEO of TradeTech Consulting, commented, "Most regulations have turned out to be significant cost drivers, and improved automation through new IT initiatives is the preferred way to counteract adverse effects of these compliance initiatives on the bottom-line. Companies who are fastest to adapt to new market conditions will emerge with significant market advantages over their competitors."

About the survey

A judgmental sampling survey was conducted in the Banking and Insurance industries in Nordic, Netherlands, the UK and other European countries. The survey, which has a confidence level of 95%, involved in-depth one on one interviews with senior financial executives. Their job titles include: Compliance Officers, Chief Financial Officers, Chief Executive Officers, Head of Administration, Chief Risk Officers, Economic Capital Modellers, Heads of Capital Management, Heads of Business Support, Heads of Treasury, Heads of Capital Markets, etc.

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A whitepaper based on the study is available for download at:

www.tradetechconsulting.se/about-us/white-papers

Global and Pan-European Banks Gaining Advantages Over National Providers

Stamford, 19 December 2013

HSBC, Deutsche Bank and BNP Paribas are the leading providers in European corporate trade finance — a traditionally stable business that is now showing signs of some change, according to the results of a new report from Greenwich Associates.

Read more: Global and Pan-European Banks Gaining Advantages Over National Providers

Strong U.S. Economic Growth in a Transforming World

London, 17 December 2013

The chief investment officers of Merrill Lynch and U.S. Trust today released their investment strategy overviews for 2014, including key themes investors should know to align their portfolios with macro trends in a transforming world.

Read more: Strong U.S. Economic Growth in a Transforming World

S&P announces 2014 weights for S&P GSCI

London, November 2013

S&P Dow Jones Indices today announced the composition and weights for the 2014 S&P GSCI®. The S&P GSCI is a world production-weighted commodity index which, in 2014, will be composed of 24 exchange-traded futures contracts on physical commodities across five sectors including: energy, industrial metals, precious metals, agricultural and livestock. There will be no substantive modifications or new contracts added to or removed from the S&P GSCI for 2014. The weights of the 2013 S&P GSCI® along with the 2014 target weights are provided in the tables below. The 2014 weights become effective with the January 2014 roll period. Please refer to the attached spread sheet for the 2014 Contract Production Weights (CPWs) and their respective target weights.

Read more: S&P announces 2014 weights for S&P GSCI

Bubble That Everyone Admits is a Bubble

London, 6 November 2013

This is one of the few times where the benefactors or professionals who benefit from the bubbles, in this case created by the Federal Reserve, fully and openly acknowledge that stock prices and certain other asset classes are completely divorced from fundamental valuations.

Read more: Bubble That Everyone Admits is a Bubble