SEC's Schapiro Expects Approval Of CME CDS Clearing Plan Soon
March 11 2009 - 1:39PM
Dow Jones News
Securities and Exchange Commission Chairman Mary L. Schapiro
indicated at a congressional hearing Wednesday that approval for
CME Group Inc.'s (CME) clearing platform for credit-default swaps
is imminent. The CME is the lone company still waiting for SEC
approval.
"We resolved all issues in the CME application," she said in
response to a question from Rep. Mark Steven Kirk, R-Ill.
Last week, the SEC signed off on a long-awaited proposal from
IntercontinentalExchange Inc. (ICE) to clear credit-default swaps.
That plan, which was launched this week, is the first clearinghouse
available for credit-default swaps in the U.S. It will be overseen
by the Federal Reserve because it is structured as a limited
purpose bank, but the SEC first had to exempt it from various
securities laws.
But the SEC's approval of ICE prompted some angry words last
week from Bart Chilton, a commissioner from the Commodity Futures
Trading Commission, who said he was disappointed that the SEC had
given ICE a competitive advantage over CME. CME's clearing plan
would be regulated by the CFTC and already got the green light from
the Fed and CFTC late last year.
Most recently, the SEC said it had delayed approving CME's
clearing plan because of unresolved issues surrounding customer
margin.
-By Sarah N. Lynch, Dow Jones Newswires; 202-862-6634;
sarah.lynch@dowjones.com