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Aite Group, Derivatives regulation, European regulation, Legal entity identification, US regulation, Vendors

Rumour has it…

April passed and a final decision on the future of the new legal entity identification (LEI) standard from the Financial Stability Board (FSB) was not forthcoming (in spite of its earlier promised deadline – see more here). However, the rumour on the street is that Swift is now out of the running for the role of registration authority (RA) for the LEI and DTCC has gone very quiet on the subject (check out an editorial from the Sifma show floor by STN here).

At this point in time, these rumours have not been confirmed by either party, but it could explain the extended delay in an official announcement. Governance has certainly been a thorny issue with regards to the introduction of a new body to be put in charge of issuing a new regulatory mandated standard (in whatever form it takes). The potential monopoly position granted to those put in charge of acting as RA or facilities manager is something that cannot be ignored. Especially given that DTCC has a commercial subsidiary that offers legal entity data mapping services. Swift’s “coopetition” model may have also come under scrutiny in this regard.

The fact that there is only speculation to go on, leaves a lot of room for concern. I’m not convinced Swift’s dealings with Iraq earlier this year have anything to do with this decision, but will we get clarity on the reasoning at all?

If Swift is out, does that mean the DTCC is too? What is the viable alternative? How will this impact the ISO 17442 standard’s chances of adoption as an LEI?

Whatever the answers to these questions, one thing is for sure, we’re in for a data standards bumper crop of discussions this summer.

If you want to check out the background to a lot of these standards discussions and decisions – including the industry’s previous attempts at establishing an LEI-like standard, check out my report from earlier this year here.

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About virginieoshea

Post-trade technology analyst at Boston headquartered firm Aite Group/regulatory and fintech doyenne.

Discussion

One thought on “Rumour has it…

  1. Reblogged this on The OTC Space and commented:
    Very interesting – perhaps this is the reasons why CICIs are needed, as it appears progress towards implementation of LEIs will take longer than expected.

    Posted by Bill Hodgson | May 3, 2012, 12:11 pm

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