Avoid regulatory bank cut European subsidiary swaps guarantee

After the financial crisis, the swaps market by tighter regulation of the United States government, America's big Banks, however, find new ways to avoid regulation.Specifically, including bank of America, citigroup, Goldman sachs, jpmorgan chase and Morgan Stanley,carbon steel ERW A106 steel pipe some Banks have started to modify some provisions of overseas subsidiaries swap contracts, to evade the authorities of the regulation of derivatives trading.

To this, there are, according to people familiar with the modified terms and conditions of the agreement is aimed at America's big Banks, London subsidiary or its and non-us swaps between Banks. Because these companies have to operate with a large number of swaps, according to the requirements related to the bank to regulators promptly disclose the details of the swap. And when the content of the part of the contract is modified,Carbon Steel A105 Industry Standard Welding Neck Flange the corporation need not guarantee for overseas subsidiaries of swaps. All contract debt entirely borne by overseas companies. On the premise of not by the parent company guarantee, such contracts will not be affected by us regulators to review.

Derivatives, a consulting firm (jack Chen Pronetik) President (JackChen) said: "cancel the guarantee measures of transfer of the legal responsibility of American corporate entities, and protect the trading behavior of overseas subsidiaries."

For Banks to swap contracts transferred to a subsidiary of the European, only by European regulators will bring many benefits. European derivatives trading rules of the earliest to wait until early 2016,hot expanded api 5L psl1 welded steel pipe and some bankers expected, even if the European regulation, its efforts will be far less than the United States. So, after the swaps parent company cut off contact with the United States, the United States parent company may further transfer part of the swap to Europe. Such a seemingly quietly shift, to give priority to with London European swap market, transfer of $700 trillion.