Singapore, HK, Australia set date for OTC margin rules

SINGAPORE: Singapore, Hong Kong and Australia will introduce collateral rules for over-the-counter derivatives trading on March 1, part of a global initiative to make transactions in the US$544 trillion market safer.

The new guidelines force financial institutions to post cash or bonds to their swaps counterparties. They will also apply to variation margins, which cover daily market swings, the Monetary Authority of Singapore, the Hong Kong Monetary Authority and the Australian Prudential Regulation Authority said in separate statements yesterday.