Swift targets EMIR compliance with trade reporting tools
Financial messaging cooperative Swift is looking to capitalise on the impending trade reporting deadline for EMIR, the European Commission’s new rulebook for derivatives, which comes into effect next month.
From 12 February, banks will have to report their derivatives trades to trade repositories. The rule is a key plank in the G20 drive to improve market transparency and reduce risks to financial stability. Swift is offering its bank customers two options for trade reporting. The first is to use the Swift FIN Copy solution to send confirmations directly to trade repositories, drawing on the customer’s existing Swift FIN confirmation connection.
The other option is to use Swift’s FileAct messaging service to report all OTC derivatives trades – a choice that Belgian bank Belfius has opted for to report its derivatives trades to European trade repository Regis-TR.
“We considered using a web service-based solution to send trade details to Regis-TR, but we opted for Swift FileAct because it offers better availability and reliability, allows us to send large files and enables better error handling through automated message monitoring,” said Luc Goossens, project management, financial markets, Belfius Bank.
According to Swift, FileAct allows “secure and reliable” transfer of files and is typically used to exchange batches of structured financial messages and large reports.
“The February 2014 deadline is not far away, and Swift’s simple, reliable, automated solutions offer a speedy route for affected entities to get ready to report their derivatives trades,” added Joe Halberstadt, senior treasury and derivatives market manager at Swift. “We are working in close collaboration with a number of the trade repositories to provide these solutions to customers such as Belfius, as part of our wider offering enabling customers to confirm, match, settle and report their derivatives trades.”
Final preparations for EMIR are underway at banks across Europe. Earlier this month, Dutch bank ABN Amro became a member of German derivatives exchange Eurex’s OTC Clear service, which clears interest rate swaps, as part of the bank’s compliance with EMIR.
The technical standards for EMIR were published in December 2012; the obligation to report is due to take effect on 12 February. It is expected that the EMIR obligation to clear will follow before the end of this year, with regulator ESMA due to release the regulatory technical standards in September.