US Securities and Exchange Commission chairwoman Mary Schapiro and Commodity Futures Trading Commission chairman Gary Gensler gave details of the Obama administration’s plan to regulate over-the-counter derivatives in Congressional testimony on July 22.

Under the plan, the SEC would have authority over derivatives linked to those securities the agency already oversees – mainly shares and bonds. Its purview would include credit derivatives. The CFTC, which oversees futures markets and exchanges in the US, would watch over everything else.

The plan also calls for stricter capital, margining, record-keeping and disclosure standards for derivatives dealers. It would also require all standardised contracts to be cleared through regulated central counterparties, and to be traded on exchanges or “transparent” electronic trading systems.

The administration is expected to introduce legislation on OTC derivatives regulation during the week of July 27.

• Schapiro testimony
• Gensler testimony 

6 Jul 2009 -

Regulatory arbs

3 Jun 2009 -

Trade offs