Chris Bender, director of regulatory advisory on Chatham Financial’s global regulatory solutions team in Pennsylvania, agrees: “We have a number of clients that have decided they will be prioritising US dealers when transacting deliverable forex forwards,” he says. But US banks don’t have it so easy themselves. While forex swaps are exempt from variation margining, some market participants fear the Commodity Futures Trading Commission (CFTC) could treat forwards as non-deliverable forwards (NDFs), which are caught by the incoming regime.
Forex swap margin treatment uncertain ahead of VM deadline
February 6, 2017