Swaps Data Darwinism: The Next Steps in Swaps Trading Evolution

The aggregation and public dissemination of OTC derivatives trade data was one of the most significant and ambitious goals of the 2010 G-20 agreement. While down in sheer number of facilities compared to other regulatory regions such as Europe, in terms of operational capacity, the US is well ahead of the curve in rolling out its reporting framework.

2016 is shaping up to be the year of swaps data. The Securities Exchange Commission (SEC) is approaching a significant mile marker in the race to an operational security-based swaps data repository (SB-SDR) for the last opaque avenue of OTC derivatives trading. The Commodities Futures Trading Commission (CFTC) also recently took a major step towards refining the workflow of its own Swaps Data Repository (SDR) in requesting industry comment on how best to improve its trade data regulatory framework.

This TABB Group report examines the progress made within the US in implementing OTC derivatives trade reporting rules between the two regulatory jurisdictions of the CFTC and SEC and the unique frameworks of the two regulatory regimes.

Key Points
 The aggressive progress made by the CFTC in implementing OTC derivative trade reporting rules has set the global standard. The regulator recently requested industry input on refining its own trade reporting/dissemination framework.
 The SEC has recently pushed back the deadline for entities wishing to register as a Security-Based SDR (SB-SDR). The implementation timeline will follow a staggered +6 month and + 9 month approach from the point at which an SB-SDR is functional to enforce SB-SDR reporting and public dissemination requirements.
 Trade data on single-name CDS is still likely a year away from being publically available.