Allan Grody on why the LEI initative should be welcomed as a measure to increase transparency.
collateral may be the metric that supports solvency in both our
financial institutions and our clearing houses but seeing what
is happening proactively as transactions are conducted is what
regulators believe will be the means of truly overseeing the
financial system. That first step on
the road to transparency seems to be close at hand with the
final recommendations for putting forward a global legal entity
identification regime set to go before the G20 later this
In recent testimony
at the US Senate Banking Committee’s hearings on
Swaps regulation it was accepted by SEC Chairman Shapiro and
CFTC Chairman Gensler, and the Senators on the Committee, that
besides capital and collateral to support the risks of swaps
transactions, transparency is a critical component of the risk
regime. Sen. Schumer asked Chairman Gensler about the
transparency issue in the context of the evolving counterparty
coding system – the legal entity
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