The regulation requires financial and non-financial counterparties to report their Securities Financing Transactions (SFTs) to authorised SFTR Trade Repositories (TR) for direct and immediate data access to NCAs.
CME Regulatory Reporting is introducing an upgraded user interface, increasing visibility and decreasing manual effort, as well as launching both UK and EU-based SFTR trade repositories.
SFTR will allow regulators to better understanding the so-called ‘shadow banking’ world through the introduction of an EMIR-like reporting regime for repo, securities lending and margin lending transactions.
When the SFTR’s reporting requirements begin to go live, most likely from early 2020, they will broaden the range of information that needs to be provided compared to all existing regimes.
SFTR will require 153 fields to be populated, many more than under EMIR or MiFIR.
Reporting needs to take place by T+1 in most situations, with trades sent to a new type of approved trade repository built specifically for SFTR.
Firms that fall into the scope of SFTR are likely to find that they can’t just ‘copy and paste’ the processes used to implement EMIR, not least because in the repo world information is usually not held in ways that make populating data fields a simple process
Securities or commodities lending and securities or commodities borrowing
Buy-sell back transactions or sell-buy back transactions
Margin-lending transactions (on a daily position basis)
Liquidity and collateral swaps (that are not classified as derivative contracts under EMIR)
Modifications, collateral updates and valuations, margin valuations for CCP-cleared transactions, collateral reuse and margin lending funding sources
Transaction terminations and positions for CCP-cleared SFTs, if opting to report modifications and collateral updates at the position-level
New features from CME Regulatory Reporting
We are treating SFTR as an opportunity to enhance our end-to-end regulatory reporting processes, learning lessons from the implementation of EMIR.
Enhanced connectivity with our triResolve reconciliation service so that data can be reconciled pre- and post-reporting, to ensure counterparty matching and data accuracy and completeness.
A sophisticated new feature that identifies discrepancies between the Unique Trade Identifiers provided by counterparties and resolves breaks, or creates UTIs automatically where none are present
CME Regulatory Reporting solution
Controlled from a single, secure and intuitive user interface, clients submit their transactional data, into the CME Regulatory Reporting Hub in multiple formats and from multiple sources, for data normalisation, enrichment, determination, reconciliation and validation. It is then delivered to your chosen SFTR Trade Repository (TR)*.
Agile Hub technology enables seamless processing of high data volumes, flexible cross-regime and cross-asset class reporting, making it the ultimate end to end reporting solution.
* CME Group will apply to become a trade repository for SFTR pending the issuance of the final technical standards from ESMA.
Are you ready for SFTR reporting implementation?
Book a complimentary consultation with one of our regulatory experts to find out.