Derivs - People and Markets

Andrew Bailey is seen as a ‘safe pair of hands’ as the new governor of the Bank of England. But while he is a veteran of the bank, his views on monetary policy are not well known, as he has never served on the Monetary Policy Committee. In that respect, though a career central banker, he resembles Christine Lagarde, who has taken the helm at the European Central Bank.

Five trade bodies have drawn up a single template for Securities Financing Transactions Regulation and European Market Infrastructure Regulation.

The way that financial and economic news is reported is a better guide to variance in global equity returns than VIX, the CBOE Volatility Index, according to research by the International Monetary Fund.

The US Commodity Futures Trading Commission has issued no action relief for market participants’ transition from swaps referencing Libor to alternative reference rates.

Northern Trust and AcadiaSoft are collaborating on a collateral management service for over-the-counter derivatives trading.

The European Securities and Markets Authority (ESMA) has launched a consultation on the rules surrounding penalties for third-country central counterparties (TC-CCPs), trade repositories (TRs) and credit rating agencies (CRAs).

Battling against falling volume, the loan market also has to work out how to replace Libor. Loan market life will surely get more stressful as the clock ticks down to December 2021, when the rate is due to be phased out, although distractions might come in the form of sustainability-linked structures, writes Mariam Meskin

For corporate treasurers, the rates markets’ transition away from Libor and other Ibor benchmarks has created a messy future for their derivatives portfolios that many would prefer not to think about. Uncertain liquidity in new products and having to understand volatility in the new benchmarks are complicating the migration but there are signs of progress amid the confusion, writes Ross Lancaster.

The transition from one set of interest rate benchmarks to another is conceptually simple. But it is also unprecedented and has deeper consequences than many realised when Libor’s abolition was announced in 2017. With contracts worth hundreds of trillions of dollars referencing the disgraced benchmark, even small errors will have vast repercussions. PPI mis-selling? You ain’t seen nothing yet. Richard Kemmish reports

As European Union regulators start to review the Markets in Financial Instruments Directive, some market participants are nervous that Germany will use the opportunity to stamp out their own ambitions for open access to clearing houses.

The US Commodity Futures Trading Commission will issue Libor-transition relief this month as its chairman warned over the threat of a “zombie Libor apocalypse”.

IG Group is appointing Mike McTighe as its chairman, to help it achieve sustainable growth and navigate regulatory change.