The U.S. Commodity Futures Trading Commission granted provisional registration to IntercontinentalExchange Inc. (ICE)’s information database on energy, interest-rate, credit and other swaps as the first swap-data repository required under the Dodd-Frank Act.
The approval of ICE Trade Vault LLC was announced by the Washington-based agency in an e-mail statement today.
Dodd-Frank, the financial-regulation overhaul enacted in 2010, called for the databases to increase swaps market transparency after largely unregulated trades helped fuel the 2008 credit crisis. The repositories are designed to collect information about trading prices and volume in part to give regulators a greater understanding of market moves.
“It’s a significant building block toward transparency in these once-dark markets,” CFTC Chairman Gary Gensler said in a telephone interview. “We have, I think, five applications in front of us right now and we anticipate one or two more. But this first one on rates, credit and energy will facilitate market participants to comply with the already finished transparency initiatives.”
Atlanta-based IntercontinentalExchange said it will initially focus on commodity and energy markets, and then evaluate opportunities for other types of derivatives.
“Global market participants will benefit from our functionality and compliance tools, which will help them manage new reporting requirements through a well-designed, cost- efficient solution,” Bruce Tupper, president of ICE Trade Vault, said in a statement.
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