Srikanth Srinivas, J Ganesh Kumar and M Anand, TCS Financial Solutions
Post the financial crisis in 2009, the European Securities and Markets Authority (ESMA) came up with the European Market Infrastructure Regulation (EMIR) to increase transparency and reduce counterparty risks in the derivatives market. This European Union regulation covered OTC derivatives, Central Counter Party (CCPs) and trade repositories with a view to increase stability in OTC derivatives markets.
With EMIR coming into force, any firm that performs transactions in derivatives markets either for trading or hedging purposes will have to comply. These participants include banks, insurance companies, corporates, investment firms, funds and CCPs. In this paper, we focus on the impact of EMIR on CCPs and the role that technology can play.