CHICAGO, April 2, 2020 /PRNewswire/ -- Cboe Global
Markets, Inc. (Cboe: CBOE), one of the world's largest exchange
holding companies, today issued a statement commending the action
of the Federal Reserve, Federal Deposit Insurance Corporation and
Office of the Comptroller of the Currency to authorize early
adoption of the Standardized Approach to Counterparty Credit Risk
(SA-CCR) by banking organizations, and thereby help strengthen
current options market liquidity during this time of unprecedented
market turbulence as a result of the novel coronavirus disease
(COVID-19) pandemic.
Statement from Ed Tilly,
Chairman, President and Chief Executive Officer, Cboe Global
Markets:
"Cboe is gratified that U.S. bank regulatory agencies
implemented this emergency action to facilitate the accelerated
adoption of the SA-CCR rulemaking on a best efforts basis.
During this time of extreme market conditions, the agencies'
decisive action signals how important the options markets are to
our economy and, in turn, how important professional liquidity
provision is to maintaining optimal markets. The options markets
are where risk transfer occurs, and well-functioning and liquid
options markets are particularly critical when investors – both
large and small – seek to transfer that risk during periods of
volatility and market stress. The early adoption of SA-CCR on a
best efforts basis is an important step to ameliorate the effects
of CEM and strengthen liquidity in our marketplace at a time when
it is needed most. We appreciate the banking agencies' willingness
to engage with us on this critical issue and applaud their swift
action. Cboe stands ready to continue our advocacy work on behalf
of the industry and the investors who rely on these markets every
day."
Cboe is a leading advocate for policies and regulations that
promote capital efficiency for all market participants and, over
the last several years, has been a tireless champion to replace the
Current Exposure Method (CEM) with the Standardized Approach to
Counterparty Credit Risk (SA-CCR), a more risk-sensitive
methodology to listed options. Cboe will continue to work with
regulators to enhance liquidity provision in the markets.
In November 2019, the bank
regulatory agencies approved the SA-CCR rulemaking. Clearing banks
are required to adopt SA-CCR by January 1,
2022. On March 27, 2020, the
agencies announced an acceleration of the timetable for allowing
banking institutions to early adopt SA-CCR on a best efforts basis
for the reporting period ending March 31,
2020. The implementation of SA-CCR will help correct CEM's
flaws by incorporating risk-sensitive principles, such as delta
weighting options positions and more beneficial netting of
derivatives contracts that have economically meaningful
relationships.
For more information on Cboe's view on SA-CCR, visit
http://www.cboe.com/aboutcboe/government-relations/policy-positions-advocacy#bankcapital.
Cboe remains deeply committed to the orderly operation and
surveillance of our markets during this unprecedented time. For the
latest updates on Cboe's market operations, visit
https://markets.cboe.com/covid19/.
About Cboe Global Markets, Inc.
Cboe Global Markets
(Cboe: CBOE) is one of the world's largest exchange holding
companies, offering cutting-edge trading and investment solutions
to investors around the world. The company is committed to defining
markets to benefit its participants and drive the global
marketplace forward through product innovation, leading edge
technology and seamless trading solutions.
The company offers trading across a diverse range of products in
multiple asset classes and geographies, including options, futures,
U.S. and European equities, exchange-traded products (ETPs), global
foreign exchange (FX) and volatility products based on the Cboe
Volatility Index (VIX Index), recognized as the world's premier
gauge of U.S. equity market volatility.
Cboe's subsidiaries include the largest options exchange and the
third largest stock exchange operator in the U.S. In addition, the
company operates one of the largest stock exchanges by value traded
in Europe and is a leading market
globally for ETP listings and trading.
The company is headquartered in Chicago with a network of domestic and global
offices across the Americas, Europe and Asia, including main hubs in New York, London, Kansas
City and Amsterdam. For
more information, visit www.cboe.com.
Media
Contacts
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Analyst
Contact
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Angela
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Stacie
Fleming
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Debbie
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+1-646-856-8734
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+44-20-7012-8950
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+1-312-786-7136
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atu@cboe.com
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sfleming@cboe.com
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dkoopman@cboe.com
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CBOE-OE
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SOURCE Cboe Global Markets, Inc.