FSB Looks to Finalize Securities Finance Regulation in 2015

The Financial Stability Board (FSB) has set out its key objectives for 2015, in which it looks to finalize rules on the shadow banking markets, such as repo and securities financing market.

In an open letter from Mark Carney, chairman of the FSB, to G20 finance ministers and central bank Governors, sets out the priorities for the FSB’s work for the next phase of reform, in which implementing rules on shadow banking markets will be key.

In the letter, he says the FSB will: “finalize the remaining elements of our regulatory framework for haircuts on securities financing transactions and set out details for monitoring implementation.”

It will also look to “complete the development of standards and processes for global securities financing data collection and aggregation, and set a timeline for implementation.”

In the letter, Carney states how trade reporting rules have been implemented in nearly every FSB jurisdiction, while around 75% of FSB members have adopted central clearing mandates for over-the-counter derivatives.

However, Carney says the FSB will look to introduce a framework to “make trade reporting truly effective.” It plans to work with other global regulatory bodies, such as CMPI and IOSCO, to propose a consultation on the design of a global Unique Transaction Identifier (UTI) and a Unique Product Identifier (UPI) “to aid consistent trade reporting.”