China capital curbs reflect buyer’s remorse over market reforms

Last year the reformist head of China’s central bank convinced his Communist party bosses to give market forces a bigger say in setting the renminbi’s daily “reference rate” against the US dollar. In return, Zhou Xiaochuan assured his more conservative party colleagues that the redback would finally secure coveted recognition as an official reserve currency […]

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Carney: UK is ‘investment banker for Europe’

The governor of the Bank of England has repeated his calls for a “smooth and orderly” UK exit from the EU, saying that a transition out of the bloc will happen, it was just a case of “when and how”. Responding to the BoE’s latest bank stress tests, where lenders overall emerged with more resilient […]

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China stock market unfazed by falling renminbi

China’s renminbi slump has companies and individuals alike scrambling to move capital overseas, but it has not damped the enthusiasm of China’s equity investors. The Shanghai Composite, which tracks stocks on the mainland’s biggest exchange, has been gradually rising since May. That is the opposite of what happened in August 2015 after China’s surprise renminbi […]

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Capital Markets

Mnuchin expected to be Trump’s Treasury secretary

Donald Trump has chosen Steven Mnuchin as his Treasury secretary, US media outlets reported on Tuesday, positioning the former Goldman Sachs banker to be the latest Wall Street veteran to receive a top administration post. Mr Mnuchin chairs both Dune Capital Management and Dune Entertainment Partners and has been a longtime business associate of Mr […]

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Financial system more vulnerable after Trump victory, says BoE

The US election outcome has “reinforced existing vulnerabilities” in the financial system, the Bank of England has warned, adding that the outlook for financial stability in the UK remains challenging. The BoE said on Wednesday that vulnerabilities that were already considered “elevated” have worsened since its last report on financial stability in July, in the […]

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Categorized | Banks

CFTC offers concession on overseas swaps

Posted on June 30, 2012

Large US banks with overseas derivatives operations may be able to dodge new US swaps rules, potentially easing industry concerns that American law would apply all over the world.

The Commodity Futures Trading Commission, America’s top derivatives regulator, on Friday issued proposed guidance that call for foreign branches of US banks to be subject to derivatives rules in the countries in which they are located so long as the CFTC deems them comparable to US rules.

    The expected move was a concession to banks including JPMorgan Chase which had argued against the CFTC enforcing certain requirements on swaps transactions occurring overseas.

    Large US and European banks have complained about the CFTC’s implementation of derivatives rules connected to the 2010 overhaul of US financial regulations known as the Dodd-Frank Act.

    They argued that the CFTC was taking a much more aggressive approach to rein in the historically opaque market than necessary.

    Under the new guidance, if JPMorgan Chase’s London branch enters into a derivatives deal with a Goldman Sachs affiliate in London, the transaction could be governed by local rules with the CFTC’s blessing.

    The five-man commission voted unanimously to issue its proposal as guidance, rather than as a proposed rule. Standards that are issued in the form of a guidance allow the agency more flexibility in applying them to market participants.