Esma clearing draft prompts new focus on frontloading
Banks may seek to insert new termination clauses in contracts with some clients, as they prepare for an 18-month frontloading window to open
Dealers are anticipating a range of pricing and contractual headaches as a result of the proposed 18-month grace period given to thousands of firms under Europe's draft clearing rules, released on July 11. So-called frontloading provisions mean all trades executed during this period need to be cleared when the deadline arrives, and some dealers and lawyers warn it is not safe to assume all these firms will have access to a central counterparty (CCP) at that point.
If they do not, trades with
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