Banks could quit CCPs that miss Esma deadline

Before European banks can apply lighter capital requirements to trades cleared elsewhere, the relevant central counterparty needs to be approved by the European Securities and Markets Authority. Dozens of venues globally now have less than a month to apply. Lukas Becker reports

Banks face a nasty capital hit unless clearing houses around the world seek approval from the European Securities and Markets Authority (Esma) by September 15 – a deadline 13 central counterparties (CCPs), from South Korea to Switzerland, have told Risk they will meet. But that leaves a host of others that have no plans to apply, or have not shown their hand – and a world of confusion.

Until recently, the Esma authorisation process laid out in the European Market Infrastructure Regulation (Emir)