Following a public tender, the International Swaps and Derivatives Association has selected an affiliate of ICE to build a new utility to facilitate compliance with new initial margin requirements.
Isda has selected the financial benchmarks arm of the InterContinental Exchange to build and operate a crowd-sourcing utility for the industry-developed Standard Initial Margin Model for managing the exchange of collateral backing uncleared swaps transactions. The centralised crowd-sourcing solution enables industry participants to use broad consensus results to determine risk buckets and weightings when calculating margin under the Isda Simm. Initial margin requirements kick in for participants with outstanding swaps notionals in excess of €3trn in September 2016 – thought to encompass around 30 to 40 counterparties. Additional participants will be brought into the regulation in four separate waves, with the final group – those with €8bn–€750bn notional – subject to the rules from September 2020.