Delays to US swaps rules, combined with a regulators disapproval of an industry-proposed clearing framework in anticipation of the proposed rule have left market participants in a precarious situation as they prepare for the incoming regime.
Internal systems updates are being made based on final and some proposed rules that achieve Dodd-Franks overarching goals, such as transparency, which will be required by regulations.
But the Commodity Futures Trading Commissions (CFTC) criticism last month of model clearing documentation jointly proposed by the Futures Industry Association (FIA) and International Swaps and Derivatives Associations (Isda) acts as a warning against preempting the rule-writing process when it comes to points of market infrastructure.
The CFTCs announcement last week makes clear that the final swaps rules will likely be passed in mid 2012. In the meantime, market participants are largely limited to watching...