Amazon founder and CEO Jeff Bezos has become the third-richest person in the world, taking the spot from Berkshire Hathaway Chairman and CEO Warren Buffett, according to Forbes. The No. 1 spot remains with Microsoft co-founder Bill Gates.
South African banks are rushing to beat the clock on a possible downgrade of the nation's credit rating by signing up with overseas central counterparties, such as LCH's SwapClear. If banks have "achieved membership, the adverse effects of such a downgrade are likely to be less," said RMB Global Markets' Stephen Linnell.
Calculating margin valuation adjustment to meet regulations for noncleared derivatives is a major priority for banks. "For [over-the-counter] noncleared trades, you are talking about a significant MVA number, often several multiples of the bid-offer spread," Numerix Chief Strategy Officer Satyam Kancharla said.
Leaving the EU could threaten the UK's 43% stake in global derivatives trades that it has built up over 50 years. Also, London's role in providing services for the derivatives industry, such as clearing, is under pressure.
The International Monetary Fund and US regulators have given Deutsche Bank heat for risks posed by its €42 trillion derivatives portfolio, which among other factors contributed to it failing Federal Reserve stress tests. Analysts wonder if Deutsche Bank would do well to abandon its US businesses, but it has little else generating profits and is the last European holdout in the investment banking market.
Optimism about the eurozone was unshaken by Britain's vote to withdraw from the EU, according to a survey by the European Commission. In July, the commission's Economic Sentiment Indicator edged up 0.2 points to 104.6.
The International Monetary Fund's slow response to the European financial crisis in 2008 left Greece unable to pay its bills, the agency's Independent Evaluation Office reported Thursday. The report suggested that the IMF yielded to political pressure from the European Commission and the European Central Bank in its treatment of Greece's bailout, agreeing to terms that drove the country into recession.
The European Commission has asked regulators to consider a change to collateral rules for swaps to exempt pension funds from sovereign-bond restrictions that would force the funds to hold assets in foreign currencies. The commission has drawn criticism for its announcement that it will miss the global deadline for completing derivatives trade rules, resulting in an imbalance in the market as US banks adopt the regulations before their European rivals.
Italian banks require flexibility from the European Commission to resolve their bad debt problems, say experts who call for a bailout of legacy non-performing loans. Article 44 of the Bank Recovery and Resolution Directive allows for an exemption from bail-in rules if it will prevent a systemic crisis, which Italian officials fear would be the result of simultaneous bank bail-ins.
Deutsche Boerse expects EU regulators to undergo an in-depth investigation, known as a phase II process, of its proposed merger with London Stock Exchange Group. Authorities will examine internal documents from both companies and gather information on competitor views and advantages to customers.
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