Articles

In addition to educating policy makers on the impact of derivatives regulation on end users, Chatham has also worked to educate the public on these important risk management tools. The following articles discuss the impact of key derivatives regulatory proposals on end users.

Higher Swaps Costs Still Likely (April 20, 2012)…A counterparty’s exposure is typically a small fraction of the swap’s notional, or face, value and that should mean only the very largest swap end users have to register as MSPs. Luke Zubrod, director of Chatham Financial’s regulatory advisory service…

Corporate Concerns Linger Over Swaps Costs (April 19, 2012) *Subscription May Be Required …“This suggests that hedging for non-financial companies will get expensive,” said Luke Zubrod of Chatham Financial, which is advising the Coalition for Derivatives End-Users. “It could force people to weigh the trade-offs.”…

CFTC Raises Swap Dealer Threshold (April 18, 2012) *Subscription Required …“This is by far the most significant rule that market participants had been anticipating,” Luke Zubrod, director of the derivatives regulatory advisory service at Chatham financial, told Markets Media…

Smaller Companies Getting a Pass From Tougher Swaps Regulation (April, 18 2012) …“Some of the people that fell in those gray areas, many of them were worried they might get caught up in the swap dealer definition,” said Luke Zubrod, a director at Chatham Financial Corp., which advises companies that use derivatives to reduce risk….

Markets Urge Caution on Regulations (Jan 2012) *Subscription Required …“If policymakers rush to judgment on solutions, they risk making risk management more expensive without fundamentally addressing the root causes,” Luke Zubrod, director at Chatham Financial Regulatory Services, told Markets Media…

House Bill Exempts Nonfinancial Companies from Derivative “Margin” Requirements (Jan 2012)… Luke Zubrod, director of Chatham Financial’s derivatives regulatory advisory service, explains that the House Bill releases non-financial users from the margin requirement … “We think this bill will be especially helpful to nonfinancial end users who are accustomed to pledging physical assets to secure their derivatives trades.” …

A Regulation Timeline But Still No Certainty (10/05/2011)Chatham Financial’s Mike Ashby explains how The CFTC offers a first glimpse of compliance deadlines for new derivatives regulations. Full Article

Will the US and Europe Come Together on Regs? (07/18/2011) Pam Brown of Chatham Financial’s derivatives regulatory advisory service, outlines what global challenges regulators face in harmonizing OTC regulatory reform. Full Article

Will the ‘Cure’ for Systemic Risk Kill the Economy? (6/20/11)
This article by Chatham’s Luke Zubrod, which appeared on the Atlantic Monthly’s website, cautions policymakers against overly burdensome regulations, which he argues can be as harmful to the economy as excessive cancer treatment is to a cancer patient.

Preparing for the New World of Derivatives (06/15/2011) Pam Brown of Chatham Financial’s derivatives regulatory advisory service, describes “a massive (and possibly chaotic) reconfiguration of the derivatives market is on the way. Here’s what companies can do to prepare.”

End User Regulatory Update: The Current State of Derivatives Regulation in the EU and U.S. (6/13/2011)…As regulatory reform evolves on both sides of the Atlantic, end users still face the possibility of new rules negatively impacting their ability to use derivatives to hedge commercial risks. Chatham Financial’s Joe Siu offers a timely update on the specific risks end users face under Dodd-Frank and EMIR…

Over-the-Counter Derivatives Reform: A Postmortem (Nov/Dec 2010)
In this article published by Corporate Finance Review, Chatham’s Luke Zubrod and Sam Peterson looks at how Title VII of the Dodd-Frank Act constitutes a massive reconfiguration of the OTC derivatives market.

There’s a Derivative in Your Cereal (7/29/2010)“Over-the-counter (OTC) derivatives are perhaps the most feared and despised of all financial creations, even more than sub-prime mortgages. After all, Warren Buffet famously referred to them as “financial weapons of mass destruction.” Though few know it, Americans’ everyday lives are touched by the hidden hand of OTC derivatives…

Beware of the Mongoose (6/17/10)
This op-ed by Chatham’s Luke Zubrod on FT.com evaluates the unintended consequences of the controversial swaps desk spin-off provision by analogy to Hawaii’s 19th century introduction of the mongoose as a solution for rat infestations that threatened its sugar crop.

What Does Europe Know About Derivatives Reform That the White House Doesn’t? (4/26/10)
This op-ed by Richard Raeburn of the European Association of Corporate Treasurers and Luke Zubrod of Chatham Financial warns against the approach that the Obama Administration appeared to be taking toward derivatives regulation in the months leading up to the passage of the Dodd-Frank Act.