This progress report provides an update on implementation of the G20 reforms to OTC derivatives markets. Highlights from the progress report are:
- Trade reporting: 19 out of 24 FSB member jurisdictions have comprehensive trade reporting requirements in force; by Q3 2017, 23 FSB member jurisdictions expect to have such requirements in force. Work is progressing on removing the legal barriers to OTC derivatives trade reporting in order to meet the June 2018 deadline to remove these barriers. Further work is also progressing on developing harmonised trade and product identifiers, and the governance frameworks for those.
- Central clearing: the majority of FSB jurisdictions (17) have frameworks for determining when standardised OTC derivatives should be centrally cleared. This has increased from 14 in June 2016. Central clearing requirements are now in force in 11 jurisdictions, mostly for interest rate derivatives, an asset class for which there is widespread availability of central counterparties (CCPs). Availability of CCPs has increased to 32, and cross-border availability of CCPs has also increased, facilitating continued cross-border activity and expansion of central clearing.
- Capital: higher capital requirements for exposures to non-centrally cleared derivatives (NCCDs) are largely in force across 23 jurisdictions, compared with 20 at end-June 2016. However, the number of jurisdictions having implemented the final standardised approach from the Basel Committee on Banking Supervision is much lower, even though it was set to be implemented by January 2017.
- Margin: considerable progress has been made, with comprehensive margin requirements for NCCDs in place in 14 jurisdictions, up from three in August 2016. However, 10 jurisdictions do not have requirements in force, and six are not expected to have them in place by end-2018. Such jurisdictions need to urgently take steps to implement these reforms.
- Platform trading: comprehensive frameworks for determining mandatory platform trading requirements are in force in 12 jurisdictions, and requirements to trade particular product types on exchanges or trading platforms are in place in six jurisdictions.