FIA President and CEO Walt Lukken made the following remarks at the 13th Lujiazui Forum International Symposium on the Rule of Law in the Financial Sector in Shanghai, China:
Welcome to FIA’s annual Boca International Derivatives Industry Conference. I hope our video intro brought back some fond memories of being in the warmth of south Florida in the company of friends and colleagues.
On behalf of FIA's membership, we wish you all the success as you begin your work as the 46th President of the United States. Policies affecting financial markets are sure to feature prominently in your agenda, particularly in light of the recent volatility in securities markets.
The paper highlights the need for 24/7 clearing and risk management to accompany 24/7 trading, ensuring sufficient liquidity in the markets, considering operational risk and utilising existing market principles and regulations to provide a roadmap.
Following the US the federal bank regulatory agencies jointly issuing answers to frequently asked questions to clarify the capital treatment of tokenized securities, FIA and other financial trade associations welcomed the news and sought further action.
FIA invites the CFTC to consider a modified regime for fully collateralized and pre-funded clearing models, including those catering to retail traders.
FIA has responded to the Financial Conduct Authority’s consultation on improving the UK Transaction Reporting Regime. FIA welcomes several positive elements within the proposals, including reduced back-reporting timelines and the removal of low-value reportable fields. At the same time, FIA highlights industry concerns relating to proposals on conditional single-sided reporting, which members believe are unlikely to deliver meaningful efficiency gains.
FIA highlights issues for consideration by the EBA for the SREP Guidelines, with the aim of increasing proportionality and increase alignment with existing EU regulatory frameworks in the Operational Resilience space.
FIA and ISDA backed CPMI-IOSCO proposals, urging clearer prescriptive treatment of FMI general business losses, stronger resources, consistent scenarios, transparency, and rejecting margin gains haircutting.
FIA submitted comments to the Clearing Corporation of India Limited's consultation on revising the capped member liability framework for Default Fund replenishment. FIA welcomed CCIL’s aim to improve transparency and predictability of members’ potential unfunded Default Fund exposure.
FIA has responded to the European Securities and Markets Authority's consultation on EMIR 3.0 draft regulatory technical standards on the elements to be considered when EU central counterparties define participation requirements. The response highlights the need for CCPs to assess clearing members based on the actual risks they pose, rather than relying on entity type or licensing status as proxies for risk. In particular, the response distinguishes between regulated non-bank financial clearing members and non-financial counterparties that typically clear to hedge commercial exposures and do not provide financial services.
FIA congratulates Mike on his confirmation to chair the CFTC. At a time when Congress is navigating a regulatory framework for digital assets, and technology is disrupting and enhancing traditional finance, Mike is the right person with the right experience to lead the agency through these times of great change.
There is tremendous change facing the cleared derivatives markets today, especially when compared to 2008 when the CFTC was last reauthorized. FIA strongly supports the reauthorization of the CFTC, as it reinforces the agency’s mission and central role in safeguarding markets critical to the global economy.
