18 of 23 of Swaps Platforms Permanently Registered by CFTC

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By Richard Hill

Jan. 22 — Eighteen of the 23 swap execution facilities that have been operating on a provisional basis have been permanently registered with the Commodity Futures Trading Commission, Chairman Timothy Massad announced Jan. 22.

The agency is continuing to review the registration applications of the five remaining temporarily registered SEFs, Massad said at an American Bar Association conference in Florida. For confidentiality reasons, the agency can't discuss why the five remaining SEFs, a spokesman said in an email to Bloomberg BNA.

In remarks in October, however, Massad said the agency's limited resources and evolving operations at some swaps platforms could mean that all SEFs won't be permanently registered at the same time (207 SLD 207, 10/27/15).

The spokesman also noted that one of the five SEFs—FTSEF LLC —only became provisionally registered this month (03 SLD, 1/6/16).

Bloomberg BNA is owned by Bloomberg, which also operates Bloomberg SEF, which is one of the newly registered platforms.

Swaps Trading

With most SEFs permanently registered, staff is freed up to work on rules related to capital requirements for swap dealers and major swap participants, and to codify numerous no-action letters related to swaps trading. The codification effort is slated to kick off in spring.

Massad added that as part of the review of swaps trading, the CFTC will consider whether it should have a greater role in the swaps “made-available-to-trade” determination process.

In other remarks, Massad said the CFTC hopes to adopt rules on automated trading and cybersecurity by the end of the year (242 SLD, 12/17/15; 227 SLD, 11/25/15). Both rulemaking initiatives “will be an important part of our agenda this year,” Massad said.

The chairman added that “soon” he will seek adoption of a rule extending a recently adopted rule on uncleared margin to international markets (125 SLD, 6/30/15). Massad said he expects the final rule, which will be harmonized with rules in other jurisdictions, to “draw a reasonable line that makes clear when we should take offshore risk into account.”

To contact the reporter on this story: Richard Hill in Washington at rhill@bna.com

To contact the editor responsible for this story: Phyllis Diamond at pdiamond@bna.com

For More Information


Massad's prepared remarks can be seen at http://www.cftc.gov/PressRoom/SpeechesTestimony/opamassad-37.