On 28 February, FIA and ISDA (the Associations) submitted a joint response to the European Securities Markets Authorities (ESMA) consultation paper on Draft Guidelines on Anti-Procyclicality Margin Measures for Central Counterparties.
The Associations agree that risk sensitive margin models will always be pro-cyclical to a degree. Our response highlights the desire for greater transparency from Central Counterparties (CCPs) margin models as lack of transparency is detrimental for market stability. In addition, the Associations encourage that ESMA’s disclosure standards are aligned with the international standards published in the CPMI-IOSCO report on “Resilience of Central Counterparties (CCPs): Further guidance on the PFMI.”
