Dodd Unveils Financial Market Reform PlanCBS

Derivatives industry veteran, Jamie Cawley, comments on pending regulatory reform and remaining levels of credit counterparty risk in the financial markets.

Old Trade Clearing Picture Unclear -Derivatives Week Online

IDX CEO Cawley, appearing on a Financial Technologies Forum panel today in New York City, discusses the economics of novating existing CDS trades into a central clearinghouse.

Challenging the Status Quo - Structured Credit Investor

IDX's Jamie Cawley discusses clearinghouse fungibility and the likelihood the market supports multiple platforms.

IDX in the News:

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10.21.2009		Old Trade Clearing Picture Unclear - Derivatives Week Online By Katy Burne It's an open question whether older, non-standardized credit default swaps will need to be cleared when U.S. reforms are enacted, according to panelists at the fourth annual OTC Derivatives Operations and Processing conference in New York this morning. Earlier this year, dealers committed to clearing 95% of all eligible CDS by the end of this month, but that referred just to new trades. The derivatives reform bill from Barney Frank, chairman of the U.S. House Financial Services Committee, would have required retroactive trade recasting, but a parallel bill from Collin Peterson, chairman of the Agriculture Committee, did not. James Wallin, senior v.p. in fixed income at AllianceBernstein, said dealers should stand ready to re-coupon old trades. Buysiders should not be obligated to novate their old positions because of the costs associated with doing so, he added. "I don't think the buyside will be happy if the cost is either extortionate or it's mandated." Jamie Cawley, ceo of CDS execution broker IDX Capital, added that novating such trades was "somewhat mission critical." "I think there is a strong sense from real money and hedge fund buysiders that there's a need to make sure their trades are current and acceptable in the market. But some of our clients don't want to spend the money. [The service] should be available, but not mandated," said Wallin. The issue is made more challenging by the fact regulars have not yet defined what makes a trade standardized. Draft legislation from both House committees and the Obama administration hands that responsibility to exchanges, based on what they are comfortable clearing and what can be confirmed by the Depository Trust and Clearing Corp.'s DerivServ unit. But some say this route would be fraught with difficulty since exchanges would have an interest in stamping more trades as standardized and clearable, thus adding to their bottom line. http://www.iiderivatives.com/Article/2321284/Old_Trade_Clearing_Picture_Unclear.html