Blog: Majority of firms are not ready for CFTC Rewrite, says S&P Global Market Intelligence survey – Securities Finance Times

There is a stark contrast between European and US financial regulation readiness, according to an S&P Global Market Intelligence survey.

The Global Regulatory Reporting Survey highlights that the financial services industry is being more proactive in preparing for upcoming regulatory change.

However, a disparity has been found between the two regions and their readiness for upcoming regulation, including European Market Infrastructure Regulation (EMIR) Refit and Commodity Futures Trading Commission (CFTC) Rewrite.

The survey found that 38 per cent of respondents with EMIR Refit requirements are confident that they will be ready, or have made significant progress on the programme, which is expected to go live in the first half of 2024.

In contrast, more than half of respondents with CFTC Rewrite reporting requirements are not ready for the implementation date in December.

According to S&P Global Market Intelligence, the industry is taking a more proactive approach to existing and new regulations, with more than half of respondents making changes in 2022 to enhance existing processes or prepare for new regulations.

The most common change has been an increased use of automation to prevent and manage errors and inefficiencies in regulatory reporting.

The survey indicates a growth in a combination of in-house and vendor reporting, particularly among Tier 1 firms, with 64 per cent of respondents currently using a hybrid approach.

Additionally, managed services for regulatory reporting is expected to increase over the next few years, with 60 per cent of survey participants identifying managed services as a tool being considered in their future plans.

The Global Regulatory Reporting Survey data was collected during August and September 2022 from 89 respondents from banks, asset managers and brokers.

Igor Kaplun, head of Cappitech business development, S&P Global Market Intelligence, says: “The survey results indicate that more than a year ahead of implementation, those firms with EMIR Refit reporting requirements are taking a proactive approach to regulatory readiness.

“As with any large-scale regulatory change, it pays to prepare early to stay ahead of the next wave of changes on the horizon.”

Ronen Kertis, head of Cappitech, S&P Global Market Intelligence, adds: “The industry has matured significantly over the past decade and there is a realisation that reporting requirements will continue to change and evolve, and firms need to plan ahead, not only for new regulations, but in terms of how best to benefit from improved technology and global solutions.

“In some regions, we are starting to see a genuine shift in the way in which firms consider and plan for their regulatory reporting requirements, while there are other regions where work still needs to be done.”

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