FESE Publishes Feedback On BIS Report On OTC Clearing And Settlement

The BIS report “New developments in clearing and settlement arrangements for OTC derivatives” analyses existing arrangements and risk management practices in the OTC derivatives market and evaluates the potential for risks to be mitigated by greater use of, and enhancements to, market infrastructure. FESE believes that there is clearly room to improve the safety and efficiency of these markets, and indeed consider this to be essential due to the close inter-relationship between trading on regulated markets and the OTC market. The use of CCP clearing, the optimal allocation/management and transfer of collateral as well as the extension of the CPSS-IOSCO Standards to providers of clearing and settlement services for OTC derivatives would contribute towards the well-functioning of OTC derivatives markets.