4.1.2 Multi-CCP re drill
Building on the 2016 multi-CCP default management re drill, the Bank has agreed with BaFin, Bundesbank and the CFTC to extend the 2017 exercise further to run across three CCPs — CME Inc has agreed to join LCH and Eurex Clearing in a coordinated re drill. The scenario and objectives of the 2017 exercise are being de ned and aim to be more stretching than those of the 2016 exercise. These will include testing hedging and auctioning procedures at CCPs and at members in stressed market conditions. The authorities are also considering testing the capacity of client porting arrangements, given the importance of porting to ensuring an orderly clearing member default.
4.1.1 EUI CSDR authorisation
As noted in Section 3.5, delays to the CSDR technical standards’ timeline meant that the requirement for EUI to provide an application for CSDR authorisation has not yet commenced. The Bank will continue to work with EUI over the coming year in respect of its compliance with the requirements of the CSDR ahead of EUI providing an application for authorisation under it. The requirement for CSDs to submit an application for authorisation will come into force six months after the publication of the CSDR Technical Standards, which the Bank envisages will take place in 2017.
4.1.5(b) EU withdrawal
The United Kingdom’s withdrawal from the European Union could pose challenges for FMIs, including potential changes in the arrangements for providing cross-border services and the potential for further signi cant market moves. The Bank will seek to ensure through its supervision that FMIs are able to identify, manage, and mitigate any such risks.