SIFMA Supports Many Derivatives Reforms

Tim Ryan, President and CEO of the Securities Industry and Financial Markets Association (SIFMA), today released the following statement in conjunction with hearings in the Senate Agriculture Committee on regulatory reform and the derivatives markets:

“Restoring stability and confidence in the economy remains our highest priority. We need smart regulatory reform that provides additional oversight of the derivatives market and greater transparency of all derivatives products for regulators, but reforms should not hobble businesses by taking away proven risk management tools that use the over-the-counter (OTC) market.

“Clearing is an important tool to reduce risk in connection with many derivatives transactions, but proposals to standardize all derivatives and force them into clearing or exchange trading would eliminate customized contracts, exposing American business to higher costs, greater risks or both.

“OTC derivatives help protect companies from a wide range of risks, including foreign exchange, interest rate and commodity price risks, all of which protect a company’s financial health and its ability to meet its financial obligations.”