Trade reporting under EMIR began on February 12, and over the past several weeks it’s been widely reported that market participants in Europe were not prepared to start reporting derivatives trades as mandated. In this video blog, Udi Sela, Vice President of the Numerix Clients Solutions Group sits down with CMO, Jim Jockle to discuss the scope of the reporting, including the general preparedness of larger banks and financial institutions, and concerns expressed thus far by both regulators and market participants. Udi elaborates on some of the challenges faced, and near-terms winners and losers.
Jim Jockle (Host): Hi welcome to Numerix Video Blog, I’m your host Jim Jockle. Trade reporting under EMIR began on February 12th and over the past two weeks it’s been widely reported that market participants in Europe have been inadequately prepared to start the reporting derivatives trades as mandated. Today with us is Udi Sela from the Financial Services Group here at Numerix. And we’re going to discuss some of the scope of the reporting including general preparedness of larger banks for financial institutions as well as some concerns thus far by regulators and market participants. Udi welcome.
Udi Sela (Guest): Thank you. Nice to be here.
Jockle: So Udi, in the Client Solutions Team, just give us a very high level – EMIR. What is it? What was the February 12th deadline, and just a quick overview would be great.
Sela: Sure so EMIR in essence is about OTC Derivatives. Now it’s about first of all, centrally reporting all the open OTC trades. And then when possible clear them, have them cleared centrally. Now of course it stems back from the subprime crisis, but basically the regulator needs to know how many time bombs are actually out there, what is the magnitude, what are the risks and so forth. It’s really about more information, and control.