Oct 03, 2013
The Depository Trust & Clearing Corporation (DTCC) today announced that five of the major Australian banks active in the over-the-counter (OTC) derivatives market are now reporting their transactions to DTCC’s Global Trade Repository, under trade reporting rules recently finalized by the Australian Securities and Investments Commission (ASIC).
As required under Pt 7.5A of Australia’s Corporations Act, Australian financial institutions registered as swap dealers with the US Commodity Futures Trading Commission (CFTC) must begin reporting their OTC derivatives transactions by the October 1 Phase 1 deadline. Australia and New Zealand Banking Group Limited, Commonwealth Bank of Australia, Macquarie Bank, National Australia Bank Ltd and Westpac Banking Corporation are already submitting their transaction data to DTCC’s global repository to fulfill their reporting obligations to supervisory authorities globally. DTCC’s centralized platform provides its clients with the ability to report trades only once and seamlessly meet regulatory requirements to ASIC and multiple other jurisdictions.
Sandy Broderick, CEO, DTCC Deriv/SERV and head of OTC derivatives post-trade processing and reporting services, said: “DTCC is the first and only trade repository to support regulatory reporting across borders for all five major OTC derivatives asset classes. Our service is designed to promote greater transparency and risk mitigation into the trading of OTC derivatives products, allowing regulators worldwide to gain a more complete picture of risk exposures, both domestically and globally, in this dynamic marketplace.”
Fred Pucci, Head of Compliance for International and Institutional Banking, Australia and New Zealand Banking Group Limited, said: “Given the cross-border nature of OTC derivatives trading, with market participants required to meet regulatory requirements imposed by multiple supervisory authorities, ASIC’s adoption of evolving international standards in their rule-making demonstrates the benefits of harmonizing new regulations. In addition, the ability for firms to leverage existing connectivity to submit trade data has been beneficial.”
Over time, DTCC’s support of trade reporting will be expanded to meet ASIC’s regulatory requirements set to take place in phases, including: Phase 2 for major financial institutions with total gross notional outstanding positions of AUD50 billion or more to report OTC credit and interest rate derivatives by April 1, 2014, and other OTC derivative instruments (other than electricity derivatives) by October 1, 2014; and Phase 3 for other Australian Authorized Deposit-taking Institutions (ADI), Australian financial services (AFS) licensees, clearing and settlement (CS) facility licensee or an exempt foreign licensee also on October 1, 2014, to report OTC credit and interest rates derivatives and April 1, 2015, for the other OTC derivative asset classes.
DTCC operates trade repositories across the globe. In the US, it supports market participants’ trade reporting for credit, interest rates, equity, FX and commodities derivatives to the CFTC through DTCC Data Repository (DDR), its US swap data repository (SDR). In Japan, DTCC is the only trade repository approved by the Japan Financial Services Agency (JFSA), accepting trades for credit, interest rates, equity and FX derivatives. DTCC also applied for a license with the Monetary Authority of Singapore (MAS) to establish a Singapore-based global OTC derivatives trade repository in Singapore, where the company currently operates a data center. DTCC also plans to support trade reporting to the Hong Kong Monetary Authority (HKMA), operating as an agent for its clients through this global infrastructure. DTCC’s current and future trade repositories have been or are expect to be prescribed by ASIC for trade reporting pursuant to the Corporations Amendment (Derivatives Trade Repositories) Regulation 2013. DTCC also intends to seek licensing to operate a trade repository under Australian law in 2014.
In the European Union, DTCC is seeking approval from the European Securities and Markets Authority (ESMA) to operate DTCC Derivatives Repository Limited (DDRL), its European trade repository, as a registered trade repository.
On a weekly basis, DTCC’s global trade repository receives between 40 and 50 million data submissions and publishes 85,000 real-time messages. Forty-five regulators around the world use DTCC’s bespoke regulatory portal. G-15 dealers, SIFIs and other regional banks already use, or have registered to use, DTCC’s reporting service.
Re-disseminated by The Asian Banker