Banks to change rules governing derivatives market
The world’s biggest banks have agreed to change rules that govern the $700 trillion derivatives market, the Financial Times reported.
Eighteen banks, ranging from Credit Suisse Group AG (CSGN.VX) to Goldman Sachs Group Inc (GS.N), have agreed to give up the right to “close out” deals on derivatives contracts if a financial institution runs into trouble, the newspaper said, citing people familiar with the matter.
The International Swaps and Derivatives Association (ISDA), the body leading the negotiations with regulators on behalf of the industry, told last month that a contractual solution for a temporary stay on derivatives “close outs” was progressing well.
The agreement to change the protocols governing the derivatives market, which will take effect from Jan. 1, 2015, will be announced in the next few days, the Financial Times told.
Source: Reuters- Banks to change rules governing derivatives market
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