FSB: U.S., Japan and Canada Only Countries to Meet Derivatives Rules Deadline

On Friday, August 26th, the Financial Stability Board (“FSB”) released a paper indicating that the U.S., Japan and Canada will have been the only nations to meet the FSB’s September 1stdeadline for countries to enact a new set of collateral rules for derivatives. According to the FSB, this disparity in rules risks creating instability in the $493 trillion international derivatives market, as firms operating internationally must comply with varying sets of standards. In its paper, the FSB urges jurisdictions to “urgently” take steps to adopt the new set of rules. Following a review of 24 countries’ regulatory standards for over-the-counter derivatives, the FSB estimates that approximately half will have met a second upcoming March deadline.

An article in Bloomberg reports that the new rules could eventually require that more than $791 billion in liquid assets be held as collateral in derivatives deals. 

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