derivatives

This is the first in a series of four articles considering central bank payment systems self-assessments against the PFMIs.

Introduction and the Bank of England Example

In response to the financial crises of 2007-2009, at the behest of G20 governments, the Financial Stability Board and its constituent bodies developed broad global standards to shore up a system that had proven all too fragile – though it must be said that the public, regulated marketplaces did function throughout (except in isolated cases where for a few days their governments closed them for fear of collapsing prices). The same cannot be said of the freezing up of the far larger OTC and banks’ market operations in that period, which was the source of the economic and social damage inflicted.

Institutions designed to provide stability have become the system’s linchpins.

On 28 November 2016, we managers at Thomas Murray were concerned to see the publication of:

COM(2016) 856 final 2016/0365 (COD)

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on a framework for the recovery and resolution of central counterparties and amending Regulations (EU) No 1095/2010, (EU) No 648/2012, and (EU) 2015/2365

We understand that this is a first legislative draft, and write in the hope that it will be very significantly amended.

Given Thomas Murray’s expertise in post-trade services, it was incumbent upon the firm to respond at length to the Financial Stability Board’s Discussion Note on resolution of CCPs, dated August 2016. This posting is excerpted from the full response, which will be posted on the FSB website in due course.

The role of exchanges has changed, and they may no longer be ‘national treasures.’ But what exactly, then, is an exchange these days? And have other capital markets actors picked up what used to be the hallmark quality standards that brought a degree of confidence to the market?

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