CFTC Approves DTCC’S Swap Data Repository

New York, September 20, 2012– The Depository Trust & Clearing Corporation (DTCC) announced today that the Commodity Futures Trading Commission (CFTC) has provisionally approved an application by DTCC Data Repository (U.S.) LLC (DDR) to create and operate a multi-asset class swap data repository (SDR) in the U.S.

“We are pleased with the CFTC’s approval of DDR as a swap data repository,” said Michael V. Dunn, Chairman of DDR. “We will be fully ready to operate on October 12, the first day of required reporting. This is an important step forward in implementing the Dodd-Frank Act and helping to bring greater transparency to the OTC derivatives market. It will allow the financial service industry to partner with regulators to more effectively monitor and mitigate potential systemic risk.”

Under CFTC rules, the process of reporting trades in credit and interest rate derivatives to an SDR is scheduled to begin on October 12, 2012. Trades in all other derivatives classes will need to be reported 90 days after that, beginning in mid-January 2013, and trades between buy-side firms will be required to be reported beginning in mid-April 2013. The CFTC is one of the first regulatory bodies globally to require mandatory reporting of OTC derivatives trading.

The CFTC approved DDR to operate for credit, equity, interest rate and foreign exchange derivatives. A request to also operate for commodities derivatives has been made, with approval still pending, but completion of that application is expected well before the January 2013 deadline.

“DTCC’s global trade repository will provide a very efficient means for us to meet our global regulatory reporting obligations,” said Lawrence Waller, Head of Market Operations, JPMorgan Chase. “This efficiency will help to ensure that reporting of swap data remains accurate and complete.”

“The DDR’s mission is to create resilient and robust reporting infrastructure to enable the industry to meet its global OTC Derivative trade reporting requirements. The industry has invested significant resources in partnership with DDR to ensure compliance with the reporting requirements of the Dodd Frank Act, and the broader G20 mandate and so this provisional approval from the CFTC is an important milestone both for the DDR and the industry,” said Oliver Stuart, Managing Director, Global Head of Derivatives Operations at Morgan Stanley.

“DTCC is working with the industry to meet the transparency needs of regulators, not only in the U.S. but globally, and expects to register solutions in many other jurisdictions as they finalize their rules, working closely with the Global Financial Markets Association (GFMA), the International Swaps and Derivatives Association (ISDA), market participants and regulators, so as to become a valuable information resource to all,” said Alberto Giovannini, DTCC Deriv/SERV board member.

DTCC created the first global trade repository, for credit derivatives, in 2006, primarily to provide processing efficiencies for the burgeoning OTC market segment. Following the financial crisis in 2008, the credit trade repository was able to provide significant information about exposures to regulators, and that led to global support for trade repositories, or swap data repositories as they are known in the U.S., to assist regulators in gaining transparency into the market and gauging and managing systemic risk issues.

Since 2008, DTCC was selected in several industry competitions held by the GFMA and ISDA to provide global trade repository services for OTC derivatives in multiple asset classes. Four of those asset classes, credit derivatives, equity derivatives, interest rate derivatives and commodity derivatives are already fully or partially operational, and the repository for foreign exchange is expected to be operational in January 2013. The addition of the U.S.-based SDR is a critical element of the DTCC effort to ensure regulators have access to as complete a global database as possible in each derivatives class.

Today, DTCC’s existing repository for credit derivatives already holds more than 98% of the OTC credit derivatives trading globally, with almost 3,000 firms voluntarily participating in the repository. DTCC also receives more than 70% of the OTC interest rate derivatives trades globally, with more than 4 million contracts with a notional value of more than $504 trillion housed in the repository, and more than 60% of the equities derivatives globally. DDR will help firms ensure compliance with CFTC regulations.

About DTCC

Through multiple operating facilities and data centers around the world, DTCC and its subsidiary companies automate, centralize, and standardize the processing of financial transactions for thousands of institutions worldwide. With almost 40 years of experience, DTCC is the premier post-trade market infrastructure for the global financial services industry, simplifying the complexities of clearance, settlement, asset servicing, global data management and information services for equities, corporate and municipal bonds, government and mortgage-backed securities, derivatives, money market instruments, syndicated loans, mutual funds, alternative investment products, and insurance transactions. In 2011, DTCC processed securities transactions valued at approximately US$1.7 quadrillion. Its depository provides custody and asset servicing for securities issues from 122 countries and territories valued at US$39.5 trillion. DTCC’s global OTC derivatives trade repositories record more than US$500 trillion in gross notional value of transactions made worldwide across multiple asset classes. For more information, visit http://www.dtcc.com/.

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