Just weeks until EU variation margin rules come into force for physical FX forwards, regulators have said schemes will probably not have to comply after all. This creates a lot of uncertainty, writes Stephanie Baxter
Schemes’ temporary protection from clearing derivatives is being undermined by new bank capital rules.
Mitigating the impact of central clearing
A group of pension fund managers have warned incoming bank capital rules could shut schemes out of derivatives or force them to sell long-term assets to generate cash.
Schemes could be subject to CVA charge for period of weeks or months
The European Commission has said that pension schemes should have a further two-year exemption from centrally clearing over-the-counter (OTC) derivatives.
Stephanie Baxter examines the impact on schemes of extending the exemption on central clearing
Schemes will find out in seven days whether they will be able to extend their exemption to centrally clearing over the counter (OTC) derivatives.
Trustees could miss hedging opportunities when the next European Market Infrastructure Regulations (EMIR) protocol on derivatives comes into force, a lawyer warns.