Today, November 1st, is the Commodity Futures Trading Commission (CFTC)’s compliance deadline for SEFs to complete onboarding documentation and provide pre-trade credit check functionality. The deadline was originally October 2nd, before a last-minute extension from the CFTC.
“In the first month of SEF trading, more than $280 billion in cross asset volume has been executed on our SEF and over 220 global firms – inclusive of the major liquidity providers – have signed our rulebook,” said Ben Macdonald, Bloomberg’s Head of Product and President of Bloomberg’s SEF. “We will continue to work closely with our clients, who have used our trading platforms for years, to help them transition to today’s new regulatory environment.”
Bloomberg’s SEF facilitates pre-trade clearing certainty for interest rate swap and credit default swaps. Additionally, Bloomberg recently developed new technology to enable buy-side investors to combine smaller sized trade orders into a single block for “bunched” clearing. After the trade is executed and cleared, it is then allocated across multiple accounts. MKP Capital completed the first-ever bunched trade via Credit Suisse on Bloomberg’s SEF last week.
Market participants can trade interest rate swaps, credit default swaps, foreign exchange swaps and commodities derivatives on Bloomberg’s SEF. Bloomberg was first to apply as a SEF in June and first to receive CFTC approval in July.