However the CFTC denies the six month full implementation delay requested by the securities industry.
Despite warnings by many securities industry firms that they and their clients are not fully ready to move swaps from over-the-counter platforms to SEFs, the CFTC apparently will not delay the October 2 deadline (i.e. this Wednesday) for SEF implementation.
Instead, the CFTC has agreed that the SEFs can have one more month (to November 1) before certain of their enforcement responsibilities with respect to participants in their markets kicks in, and before they have to start reporting data about certain types of swaps. The partial delay will give the SEFs and their clients more time to become familiarized with the new rules, while still trading swaps via the SEFs.
SEFs have been introduced by US financial regulators as a response to the derivatives-driven market collapse of 2008, which led to the unraveling or even (near or total) collapse of financial stalwarts such as Bear Stearns, Lehman Brother, AIG, and RBS, among others. SEFs are aimed at forcing complex derivatives called swaps into open trading venues. Electronic trading platforms that want to trade swaps have to start complying with new rules on October 2.
According to Bloomberg, the CFTC also sent a letter to banks which provide clearinghouse access to their customers that they must perform pre-trade credit checks, to ensure users are in good standing before accepting their trades.