ISDA’s Post

Who should pay the auditors? Very interesting to see that the FSB is recommending in their latest Peer Review that FINMA should contract and pay the audit firms directly for some of the work that they outsource to external audit in their ongoing supervision of UBS. This recommendation would appear to have much wider implications for other banking regulators and their supervision of G-SIBs and other larger firms. I really do like the transparency of the FSB's Peer Review of FINMA and as Switzerland now only has one G-SIB it all relates to FINMA's supervision of UBS. Look forward to reading future reports on the ECB, Bank of England and Federal Reserve! #FINMA #UBS #GSIB #PRA #FSB #audit

ISDA chief executive Scott O'Malia opened the #ISDA/SIFMA Treasury Forum in New York this morning with a call to market participants to prepare early for the introduction of mandatory clearing of certain US Treasury securities, and for regulators to consider various rules in combination to ensure there’s no adverse effect on the liquidity and resilience of the Treasury market. “This represents a massive structural shift for a market that plays such a vital role in keeping the wheels of the global financial system turning. As a result, we need to think very carefully about what those changes will entail and ensure there’s plenty of time to prepare. But we also can’t consider these requirements in isolation – we should think hard about the impact of various rules in combination to ensure policymakers achieve the outcome they want: a resilient, efficient Treasury market.,” he said. Read the full remarks here: https://lnkd.in/em_SDaWP

The Swiss authorities have made important strides toward implementing an effective too-big-to-fail regime for global systemically important banks (G-SIBs). Nevertheless, the merger of Credit Suisse and UBS into an even bigger G-SIB that will be the world’s largest as a percentage of the home jurisdiction’s economy underscores the importance of further strengthening the domestic regulatory, supervisory and resolution framework for G-SIBs. Our Switzerland Peer Review report has more: https://lnkd.in/e_s3Gt5C #FinancialStability #GSIBs #TooBigToFail #TBTF

Same story ... different bank ANZ's recent scandal mirrors the infamous NAB debacle of 2004—two decades later, and it’s clear the financial services industry hasn’t fully addressed these issues. Despite oversight from the likes of ASIC and APRA, these events continue, exposing a persistent failure in fostering a "speak up" culture. Prioritizing profit over people remains a major barrier to real change. Back in 2004, NAB’s fallout saw the Chair, CEO, and CRO step down, but fixing these cultural and ethical failings has dragged on far too long. ANZ’s 39,000 employees deserve better leadership, or history will keep repeating itself. Read the following The Age article and tell me what you think. #culture #business #banking #leadership #history https://lnkd.in/gg3Ga7eE

We're delighted to have obtained our Australian Financial Services License to bring world-class currency risk management services and global accounts to Australian businesses. The Australian license underscores Argentex’s commitment to providing best-in-class solutions and empowering Australian businesses to effectively navigate currency volatility. Congratulations to the Australian Argentex team: Mark Brown, MBA, Bill Christopoulos, Freon Amanna, Gautam Premkumar, Tomasz Ciesla, CFA, Jeremy Bright, and Aaron Bird, for their commitment towards achieving this strategic milestone. Jim Ormonde, CEO at Argentex, comments: “Australia is a dynamic market with diverse currency needs and we are thrilled to receive the AFSL. It reflects our strong reputation and leverages the group’s experience to diversify into broader alternative banking markets more progressively. As part of our long-term growth plans and strategy, the license highlights our conviction to transform the business into a global, cross-border, financial solutions provider.” https://lnkd.in/g7iEGf4h #agfx #currencyrisk #fx

Your trust in us along with your support has helped us in the over-subscription of the Initial Issue of the Basel III Compliant Debentures. Managers and Placement Agents to the Issue: NDB Investment Bank Limited #NDB #NDBBank #Debenture

Your trust in us along with your support has helped us in the over-subscription of the Initial Issue of the Basel III Compliant Debentures. Managers and Placement Agents to the Issue: NDB Investment Bank Limited #ndb #NDBBank #debenture

I was very honored to exchange views at the #Eurofi 2024 High Level Seminar in Budapest, within the Panel Session: "Financial Stability in Europe: risks from indebtedness, NBFI, private credit...". I stressed that, for AXA Investment Managers, tackling the topic of Non-Bank Financial Intermediaries (NBFIs) should start with clearly differentiating Regulated NBFIs from Non-Regulated NBFIs. Asset Managers complying with the UCITS and AIFM Directives are already known by regulators through initial licensing, ongoing monitoring, enforcement, and sanctions if needed. They are totally different from Non-Regulated NBFIs, which may generate the occurrence of Systemic Risk, as it was seen recently with the Archegos family office bankruptcy having led to enormous financial losses for Credit Suisse. Therefore, the priority for action might be: for policy-makers to regulate some types of currently Non Regulated NBFIs to make them better known by regulators (e.g. family offices like Archegos); for banking supervisors to enhance their monitoring of the due diligence carried out by banks when assessing their counterparty risks (in particular vis-à-vis Non-Regulated NBFIs); and for securities regulators to enhance their holistic market surveillance, which by nature includes Non-Regulated NBFIs among others. Thank you for the exchange of views with my fellow panelists from various public authorities, including: Gaston Gelos from the Bank for International Settlements – BIS; Francesco Mazzaferro from the European Systemic Risk Board; Sarah Pritchard from the Financial Conduct Authority; and David Kutasi MBA from the Magyar Nemzeti Bank. See my article on p. 279 of the Eurofi Magazine: https://lnkd.in/dVYRmFKN #CapitalMarketsUnion #nbfi #financialstability

Bloomberg: BlackRock and Vanguard face another round of scrutiny from the Federal Deposit Insurance Corp., which wants to keep the large asset managers from swaying banks where they have sizable stakes. In a letter last week to the two companies, FDIC staff are said to have sought details about the firms’ investments in banks and asked for proof that they’re operating as passive shareholders rather than activists. The letter puts the asset managers on notice that any stake held in an FDIC-supervised bank that exceeds the threshold of 10% could trigger tougher responses from the regulator. The missive follows a months-long debate among FDIC officials over how the agency could get more influence over asset managers’ investments in banks. —David E. Rovella

What the Lehman Crisis Taught Us ? The Lehman Brothers crisis during the 2007 Global Financial Crisis shook the financial world, highlighting the excessive credit risk in the market and the critical need to manage counterparty credit risk in derivative trading. The fallout from Lehman’s bankruptcy, along with the bailouts of companies like AIG and the Royal Bank of Scotland, demonstrated how interconnected various financial products are and how these connections can lead to global crises. In response, several measures were integrated into pricing and regulations. Tools like credit value adjustment (CVA), debt value adjustment (DVA), funding value adjustment (FVA), and other value adjustments—collectively known as xVA—became vital for quantifying and managing risks related to funding, collateral, and capital costs. As a result, even the pricing of simple derivatives grew more complex due to these adjustments. Regulations such as Dodd-Frank and EMIR were implemented, imposing higher capital requirements and mandating clearing, which added more layers of complexity to derivatives trading. Despite these challenges, derivatives remain essential for effective risk management in both exchange-traded and OTC markets. I will share more on this from a practical perspective in the global derivatives trading world in the coming days, so stay tuned #mustufapetiwala #derivatives #markets #finance