Singapore MAS Proposes Margin Requirements for Non-Centrally Cleared OTC Derivatives

On October 1, 2015, the Monetary Authority of Singapore (MAS) issued a consultation paper seeking comments on policy proposals to subject all over-the-counter derivative contracts (OTC derivatives) that are not centrally cleared by a qualifying central counterparty to margin requirements.

These proposals complement the MAS’s move to introduce a central clearing regime for certain OTC derivatives in 2016. The MAS consulted on draft regulations for mandatory clearing of derivatives contracts in July 2015. The first OTC derivatives proposed to be subject to mandatory clearing are interest rate swaps see report by the authors at WSLR, August 2015, page 32.

The proposals in this new consultation paper aim to reduce ...