On July 20, ISDA responded to a consultation paper from the Clearing Corporation of India Ltd (CCIL) on a proposal to introduce stress loss margin (SLM).
ISDA members are supportive of the introduction of SLM for the derivatives segment as it collects higher margins from members, driving stress losses beyond a certain limit, and reduces loss mutualization among members by limiting their default fund requirements, moving towards a defaulter pay model. This is a positive development aligning CCIL’s risk management practices with that of global CCPs such as LCH and Eurex.
ISDA also highlights some suggestions to help members adapt to the SLM requirements, addressing procyclicality of SLM to ensure adequacy of the default fund, as well as introducing SLM in the non-derivatives segment. Comments also included a clarification on the impact of threshold parameters and a request to accept government bond securities as one of the resources accepted to settle SLM.
Documents (1) for ISDA Responds to CCIL Consultation on Stress Loss Margin
Latest
ISDA Responds to AMLA on AMLR
On May 7, ISDA responded to the Anti-Money Laundering Authority’s (AMLA) consultation on draft regulatory technical standards (RTS) on customer due diligence under the Anti-Money Laundering Regulation (AMLR). In the response, ISDA endorsed the Association for Financial Markets in Europe’s...
Episode 57: Clarity on Crypto
As the Clarity Act works its way through Congress, US regulators are evolving their approach to digital assets. Securities and Exchange Commission commissioner Hester Peirce joins The Swap to talk about crypto regulation, Treasury clearing and artificial intelligence. Please view...
ISDA AGM Studio: Darcy Bradbury & Tyler Wellensiek
Darcy Bradbury, ISDA board member and managing director at D. E. Shaw, and Tyler Wellensiek, managing director and global head of market structure at BlackRock, speaks with Chris Young, ISDA’s head of US public policy, about how the post‑crisis regulatory...
Response to ESMA Guarantees
On April 30, ISDA responded to the European Securities and Markets Authority (ESMA) consultation paper on guarantees as central counterparty (CCP) collateral and certain aspects of CCP investment policy. ISDA broadly supports ESMA’s proposed draft regulatory technical standards (RTS) to...