Uncleared-swaps margin rule lacks risk-based activity measure, CFTC's Giancarlo says

23 April 2019 8:54pm
US Commodity Futures Trading Commission chief Christopher Giancarlo voiced displeasure with derivatives-activity measures due to take effect next year in final margin standards for uncleared swaps, but acknowledged a lack of clear alternatives.

“We’ve been grappling with it internally at the agency,” Giancarlo told an industry advisory panel* last week. Speaking of the notional activity measures, he said: “We don’t want to chuck them out without something better, without something better that is risk-based.”

But at some point, Giancarlo added, “we want to start using measurements that do measure risk.”

He invited suggestions for alternatives from industry, which has been sharply critical of the final phase of the rule due to go into effect in September 2020 for about 700 US firms with limited activity.