Margin requirements for derivatives – but which OTC’s will be affected?

The International Swaps and Derivatives Association Inc. (ISDA) indicated that South Africa has been in focus over recent months since the margin requirements for non-centrally cleared derivatives transactions were published for comment in June 2015. The aim of the requirements is to outline the future regulation of OTC derivatives in South Africa in line with South Africa’s G20 commitments.

Although the margin requirements have been published, the regulators in South Africa have not yet specified which types of the over the counter derivatives will be eligible for central clearing and therefore subject to the margin requirements. Once this level of detail has been published, the impact of the regulations on the local market can be better assessed and we will comment when this happens.

Click here to see the ISDA summary circulated to member banks and the article prepared by Norton Rose Fulbright in Johannesburg.