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Firms wary of March 1 margin deadline

01 March 2017


Firms have had to re-paper their agreements with counterparties and invest in their operations to handle daily margin calls

Read more: margin derivatives

Wednesday March 1 saw the introduction of rules that require all firms holding swaps to start exchanging with their counterparties variation margin.

National regulators have been moving individually over recent months and weeks to offer reassurance they will be lenient in their treatment of non-compliant firms so the impact on some firms may be deferred.

Yet the feeling on the eve of the deadline is the industry has once again fallen well short of its mark and many firms are at this stage far from ready to process variation margin on a daily basis.

Phil McCabe, head of collateral management at Bloomberg, told FOW: "I don’t think anyone feels that most people will be ready. Estimates vary between 10% and 30% of the market being ready but I suspect the real number is at the low end of that scale."

David White, the head of sales for triResolve, part of...