Entity scope (in scope, out of scope, exemptions)
- Covered Swap Entities (CSEs)
- Financial End Users (FEU) with or without "material swaps exposure"
- An entity has "material swap exposure" if (at group level) it have an average daily aggregate notional that exceeds USD8 billion in uncleared swaps, SBS, FX forwards and FX swaps for June, July and August of the previous calendar year
The regulatory margin rules do not apply to:
- Central banks
- Multilateral development banks
- Bank of International Settlements (BIS)
- Transactions with commercial end users
- Qualifying small banks (generally insured depository institutions and credit unions with less than USD10 billion in assets)
- Qualifying captive finance companies
- Treasury affiliates
- Certain cooperative entities that would satisfy an applicable clearing exemption
Transactions scope (in scope, out of scope, exemptions)
Initial margin (IM) and variation margin (VM) requirements generally apply to all OTC derivative trades.
Physically settled FX (spot, fx forwards and fx swaps).
Calendar if different form BCBS-IOSCO
Aligns to BCBS-IOSCO calendar
1 September 2016 – Largest market participants - Aligns to BCBS-IOSCO calendar
1 March 2017 –
- All other in-scope entities regulated by the Commodity Futures Trading Commission (CFTC) and Prudential Regulators (PRs) - Aligns to BCBS-IOSCO calendar
- CFTC and PRs have both issued statements of relief under certain conditions. Retroactive application of VM to trades entered into on and from 1 March 2017.
Eligible collateral would generally include the examples below. However, HSBC will continue to have its own requirements and policies with regard to the collateral it can accept from this list.
- High-quality government and central bank securities
- High-quality corporate bonds
- High-quality covered bonds
- Equities included in major stock indices
Please click here to review the US Commodity Futures Trading Commission's (CTFCs) list of eligible collateral. Please check Article 23.156 (p. 701).
Please click here to review the US Prudential Regulators (PR) list of eligible collateral. Please check § __.6 Eligible collateral (p. 74903).
Any other specificity