SRO Alert! Proposed Rule Changes ICE Clear Europe, Ltd.
provide that their framework for monitoring counterparty credit risk covers links--set of contractual & operational arrangements between 2 or more clearing agencies connecting them directly or indirectly for settlement (example cross margining)
Source: https://public-inspection.federalregister.gov/2023-02510.pdf
“Link” means “a set of contractual and operational arrangements between two or more clearing agencies, financial market utilities, or trading markets that connect them directly or indirectly for the purposes of participating in settlement, cross margining, expanding their services to additional instruments or participants, or for any other purposes material to their business.”
Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change
ICE Clear Europe is proposing to revise the CC Risk Policy in order to provide that the Clearing House’s policies for monitoring counterparty credit risk apply to links, as defined in the Commission’s regulations. ICE Clear Europe is also proposing to revise the CC Risk Procedures to make conforming updates in respect of links and to make certain other clarifications and enhancements.
It looks like these 'link' relationships weren't adequately called out before and ICE Clear Europe does not want to be left on the end of it?
It sure seems that way:
Wait, since Superstonk is in the public record now because of the sit down with Gary, does that make it 'public news' that should be considered?
With respect to exposure limits and related capital calculations for purposes of CMs that are part of a Systemically Important Institution, the amendments will use the more specific definition of Systemically Important Institutions in the Parameters as an institution with assets greater than 200 billion Euros that is treated as a Globally Systemically Important Institution by the European Banking Authority. This would replace the previous, more subjective standard.
WUT mean if wanting to comment?
ICE Clear Europe Limited (“ICE Clear Europe” or the “Clearing House”) proposes to modify its Counterparty Credit Risk Policy (the “CC Risk Policy”) and Counterparty Credit Risk Procedures (the “CC Risk Procedures”) to provide that the Clearing House’s framework for monitoring counterparty credit risk covers links.
“Link” means “a set of contractual and operational arrangements between two or more clearing agencies, financial market utilities, or trading markets that connect them directly or indirectly for the purposes of participating in settlement, cross margining, expanding their services to additional instruments or participants, or for any other purposes material to their business.”
Generally speaking, I think commenting in favor of having this information is in the public's best interest as the Clearing House presently does not have the framework for monitoring counterparty credit risk covering links (which as defined seems like a pretty big oversight).
