Reval to Serve as Trade Repository of OTC Derivatives for Corporate End-users
Reval, a global provider of derivative risk management and hedge accounting solutions, is intending to serve as a trade repository for over-the-counter (OTC) derivatives used by corporate end-users.
According to the Obama Administration’s white paper on Financial Regulatory Reform released on 22 June, all OTC derivatives are to be recorded in a trade repository for regulators to monitor systemic risk, gain transparency and efficiency, control market manipulation and ensure that derivatives are sold properly. These include those derivatives used by companies to hedge business exposure to fluctuating interest rates, foreign exchange (FX) rates and commodity prices.
“Since its inception a decade ago, Reval has specialised in helping companies value and effectively account for derivative products used to hedge business risk,” said Reval chief executive and co-founder Jiro Okochi. “We are already, in fact, a trade repository for corporate end-users of OTC derivatives. With our ability to book, manage risk, value and account for derivatives across all asset classes, we have the technology and expertise today to help clients comply with whatever may become law and to help regulators obtain the reports they will require. Whether the idea of a trade repository takes the form of a sole repository or multiple repositories, Reval will certainly have a role to play in assisting its corporate clientele and the government.”