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Banks caution Europe against new debt swap
March 9, 2012--The head of the Institute of International Finance, Charles Dallara, warned Friday against any more eurozone sovereign debt restructuring in the wake of Greece's huge writeoff deal.
"I would strongly discourage other governments, other peoples of Europe from going this route," Dallara, the IIF managing director who led the private-sector negotiations with the Greek government, told CNBC television.
On Thursday the world's biggest debt restructuring in history was completed, accepted by an overwhelming majority of Greece's private creditors.
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Source: EUbusiness
The eurozone-IMF rescue for Greece: the main points
March 9, 2012--The Greek bond swap is intended to avert default by Greece when debt falls due on March 20 and is a key part of a eurozone-IMF rescue worth up to 237 billion euros to enable the country to rebuild its economy.
Some 83.5 percent of the country's private creditors tendered bonds for exchange, the Greek finance ministry announced on Friday, solidly above a 75-percent requirement Greece had set for the deal to move forward.
Here are the main points of the overall rescue package as published by the Eurogroup of eurozone finance ministers, with extra detail from the Greek finance ministry on Private Sector Involvement (PSI) in the debt writedown:
Under the PSI debt write-off by banks, insurance companies and investment funds, these investors will lose 53.5 percent of the face value on the 206 billion euros ($273 billion) of privately-held Greek debt. This will reduce the debt owed by Greece to private creditors by 107 billion euros. Greece has a total public debt of about 350 billion euros.
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Source: EUbusiness
It's Official: ISDA Triggers Greek Credit Event In Unanimous Decision
March 9, 2012--The International Swaps and Derivatives Association determined today that Greece's bond swap has triggered a credit event.
That will lead to payouts of credit default swaps—essentially, insurance contracts on holdings of Greek bonds under Greek law—that investors purchased to hedge against the risk of holding Greek sovereign debt.
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Source: Business Insider
Component changes made to EURO STOXX Select Dividend 30 Index
March 8, 2012--STOXX Limited, the market-moving provider of innovative, tradable and global index concepts, today announced changes in composition of the EURO STOXX Select Dividend 30
Index which will become effective March 19, 2012.
Due to a decrease of its dividend payments and negative earnings, LUFTHANSA (Germany, Travel &
Leisure, LHAG.DE) is no longer eligible to be added to the index.
With the open of European markets on March 19, 2012 the following companies are being added to and deleted from the EURO STOXX Select Dividend 30 Index:
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Source: STOXX
European regulators undecided on initial margin rules for uncleared swaps
March 8, 2012--Counterparties will have to post variation margin on uncleared trades-but questions remain over which firms will have to post and collect initial margin
European regulators are still unsure to what extent swaps counterparties should be required to provide and collect initial margin on uncleared derivatives trades, and are considering three potential options - one of which resembles the uncleared margin rules proposed by US regulators in April last year.
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Source: Risk,net
ESMA Makes Available The Recording Of The Open Hearing On EMIR
March 8, 2012--On 6 March 2012, ESMA organised a Public Hearing on draft technical standards on EMIR.
Due to a limited number of places at this hearing, a recording was made, which ESMA makes available on the following page: http://esma.europa.eu/page/post-trading
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Source: ESMA
Clearstream and Deutsche Bank partner to facilitate market access to Russia
March 8, 2012--Clearstream and Deutsche Bank, partners in the Russian market for 6 years, continue to facilitate market openness in the region.
Clearstream, via its Russian agent Deutsche Bank Ltd. Moscow, now has successfully settled its first domestic government bond transaction on an over-the-counter (OTC) basis. This type of transaction represents a significant step forward in the liberalisation of the Russian government bond market: Clearstream customers can now safekeep Russian government bonds (OFZ bonds) in addition to Russian equities. The expansion of the service for Russia has been made possible by recent changes in the local securities market regulation. The changes were developed through close collaboration between local market participants and regulators.
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Source: Clearstream
Commission acts to increase the safety and efficiency of securities settlement in Europe
March 7, 2012-- As part of its ongoing efforts to create a sounder financial system, the European Commission has proposed today to set up a European common regulatory framework for the institutions responsible for securities settlement, called Central Securities Depositories (CSDs). The proposal will bring more safety and efficiency to securities settlement in Europe. It also seeks to shorten the time it takes for securities settlement and to minimise settlement fails.
Commissioner for Internal Market and Services Michel Barnier said: "I am committed to ensuring that all financial markets are properly regulated and supervised. Settlement is a crucial process for the securities markets and the financing of our economy, and as such its safety and efficiency needs to be ensured. The numbers speak for themselves: in the European Union, transactions worth over one quadrillion euro were settled by CSDs in the last two years. Today's proposal will introduce, in line with our international partners, common standards across the Union for securities settlement and CSDs to ensure a true single market for the services provided by national CSDs."
The proposal contains the following key elements:
The settlement period will be harmonised and set at a maximum of two days after the trading day for the securities traded on stock exchanges or other regulated markets (currently two to three days are necessary for most securities transactions in Europe).
Market participants that fail to deliver their securities on the agreed settlement date will be subject to penalties, and will have to buy those securities in the market and deliver them to their counterparties.
Issuers and investors will be required to keep an electronic record for virtually all securities, and to record them in CSDs if they are traded on stock exchanges or other regulated markets.
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Source: Europa
STOXX announces new composition of Select Dividend, Style and Grand Prix Indices
March 7, 2012--Results of the Review to be Effective on March 19, 2012
March 7, 2012--STOXX Limited, the market-moving provider of innovative, substantial and global index concepts, today announced the results of the annual review of the STOXX Select Dividend Index series and the STOXX Global Grand Prix Index; as well as the result of the semi-annual review of the
STOXX TMI Growth and STOXX TMI Value indices, their respective large, mid- and small sub-indices and the respective indices for the euro zone.
All changes will be effective on March 19, 2012.
The STOXX Europe Maximum Dividend 40 Index is also part of this regular review. Its new composition can
be found on the respective index page at www.stoxx.com on March 19, 2012.
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Source: STOXX
Commission proposal on improving securities settlement in the EU and on Central Securities Depositaries - Frequently Asked Questions
March 7, 2012--1. What does the proposed regulation address?
The proposal aims to harmonise both the timing and conduct of securities settlement in Europe and the rules governing Central Securities Depositories (CSDs) which operate the infrastructures enabling settlement.
With regard to settlement, the proposal harmonises timing and discipline of securities settlement in the EU.
Regarding CSDs, it creates, for the first time at European level, a common authorisation, supervision and regulatory framework for CSDs.
2. What is settlement?
Any trade in securities on or off a trading venue is followed by a post-trade flow of processes, including for example confirmation of the trade details by a trading venue or clearing by a central counterparty (CCP), leading to the settlement of the trade, which means the delivery of securities to the buyer against the delivery of cash to the seller. Settlement may occur on the day of the trade, but more often a number of days later depending on the type of securities, the type of trading venue, or the type of market concerned.
3. What are CSDs?
The CSDs are the key institutions that operate the infrastructures (so-called securities settlement systems) that enable settlement. They are the institutions which materialise the transactions concluded on the markets. It is with them that settlement is either finalised, or fails. CSDs also ensure the maintenance of securities accounts that record how many securities have been issued by whom and each change in the holding of those securities. This is made possible by the fact that CSDs intervene on the primary market, by centralising the initial recording of newly issued securities. CSDs also play a crucial role for the financing of the economy, as in practice almost all the collateral posted by companies, banks and other institutions to raise funds flows ultimately through securities settlement systems operated by CSDs.
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Source: Eurostat
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