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Asia and Latin America News Network focusing on Financial Markets, Energy, Environment, Commodity and Risk, Trading and Data Management

Derivatives: Struggling Into the New Era – Outlook 2013/14

The past few years have been challenging for the global economy but it seems as though the derivatives industry sustained more than its share of insults and injuries over the past year or so. Still reeling from the trauma of MF Global in October of 2011, exchange-traded volume went into its first nosedive in decades.

Urgent regulatory requirements added intense cost and time pressures to company staffs that were already stretched. A non-clearing FCM, Peregrine Financial, collapsed in scandal. OTC derivatives struggled with complex regulatory mandates and weak volume.

Perhaps the only positive for the year was that mergers and acquisitions at both the macro and micro level imply that innovation and creativity are still powerful industry drivers. That in turn suggests that the creative dynamism that has characterized the derivatives industry for so many years still has some innings to go.

Read the detailed report about Derivatives market outlook, challenges and issue of big deals, exchange mergers and new start ups, customer protection, Regulatory,Extraterritorial and Tax problems  and more. 

Source: WEF 25.04.2013 by Nicolas Ronalds

Filed under: Asia, Brazil, Exchanges, Risk Management, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

BM&FBOVESPA’s Regulation System As A Model For The Rest Of The World; to offer Services to Europe,Asia and North America

Brazil’s Finance Minister Suggests BM&FBOVESPA’s Regulation System As A Model For The Rest Of The World – Specialists From The Exchange Will Offer Services And Products To Exchanges In Europe, Asia, And North America.

During the G-20 Summit, held in Washington DC, from November 14 to 15, Brazil ‘s Finance Minister, Guido Mantega, addressed world leaders on regulations for the derivatives market.

In an interview with the press, Mr. Mantega recommended BM&FBOVESPA’s clearinghouse settlement, collateral and custody systems as a model for the rest of world to follow. He also suggested that technical meetings be held by the G-20 members in order to discuss the regulatory instruments that should be put into practice by world markets.

During an interview with the Agencia Estado in Washington on the eve of the Summit meeting, Friday (Nov/14), Mr. Mantega cited the need to evaluate how hedge funds and derivatives should be regulated in the future, explaining to a reporter: “I believe the procedure we use in Brazil should be one of the solutions, which is to establish clearinghouses, like the ones in BM&F, where a derivatives transaction must be registered, the client must deposit collateral, and the client becomes subject to additional margin requirements if necessary. They don’t have this here. This is a proposition for the derivatives market and for CDS (credit default swap) market, which perhaps today represents the largest volume of derivatives that have not yet been dealt with, and currently stands at USD55 trillion in derivatives activities that must be regulated together with other markets.”

Source: Mondovision 20.11.2008

Filed under: Banking, BM&FBOVESPA, Brazil, Exchanges, News, , , , , , , , , , , , , ,