In November 2021, the European Securities and Markets Authority (ESMA) published a consultation on its report on highly liquid financial instruments with regards to the investment policy of central counterparties. In this consultation, ESMA reviews whether the current, fairly restrictive list of investment options for central counterparties (CCPs) should be extended. The report contains a very thorough analysis of regulation and CCP practices in other jurisdictions and proposes some extension of the range of investments available to a CCP, for instance debt issued by the EU but also consults about including corporate debt. On money market funds, ESMA is more careful and proposes for now not to allow these funds.
ISDA members are very supportive of some of the extension of investments available to the CCP and propose to be less prescriptive but to give the CCP and its governance forums including supervisors more leeway. In the response, we also support the inclusion of public debt constant net asset value money market funds, which had significant inflows during the crisis in 2020.
Please find below the ISDA response.
Documents (1) for ISDA Responds to ESMA on Eligible CCP Investments
Latest
ISDA, IIF Response to PRA on Market Risk Framework
On September 12, ISDA and the Institute of International Finance (IIF) submitted a joint response to the Prudential Regulation Authority’s (PRA) consultation on adjustments to the market risk capital framework (CP 17/25). ISDA and the IIF strongly believe the market...
ISDA Response on Clearing Costs
On September 8, ISDA responded to consultation by the European Securities and Markets Authority (ESMA) on a draft regulatory technical standard on clearing fees and associated costs (article 7c(4) of the European Market Infrastructure Regulation (EMIR)). In the response, ISDA...
ISDA Response on Margin Transparency
On September 8, ISDA responded to a consultation by the European Securities and Markets Authority (ESMA) on a draft regulatory technical standard under the European Market Infrastructure Regulation (EMIR 3.0) on margin transparency requirements. ISDA’s members are supportive of margin...
Paper on Liquidity Assessment for Single-name CDS
On September 5, ISDA submitted a paper to the European Securities and Markets Authority (ESMA) and the European Commission in support of its earlier response to ESMA’s Markets in Financial Instruments Regulation (MIFIR) review consultation package 4 (CP4) on transparency...