The Securities Financing Transaction Regulation (SFTR) is an important part of EU’s efforts to improve the transparency of securities financing transaction markets and consequently also of the banking sector and the broadly understood financial system. The SFTR requires that details of SFTs are to be reported to authorised trade repositories by all market participants, including financial and non-financial counterparties. The SFTR ensures that European supervisory authorities have access to details of securities financing transactions and aims to improve risk monitoring tools, which should improve the safety of the financial markets.
Examples of SFTs:
- securities lending and borrowing,
- repo and reverse repo transactions in securities and guaranteed rights,
- buy-sell-back and sell-buy-back transactions in securities, commodities and guaranteed rights,
- collateral management transactions.
The definition of securities financing transactions under the SFTR does not include derivatives as defined under EMIR (Regulation No. 648/2012). However, it includes liquidity swaps and collateral swaps, which are not covered by the definition of derivatives under EMIR.
The Trade Repository Rules for Securities Financing Transactions
, enter into force on 12 December 2019 on the basis of Resolution No. 49/817/19 of the KDPW Supervisory Board of 11 October 2019, published on 27 November 2019 (relating to the mandatory reporting of securities financing transactions from 13 April 2020 onwards)
Final Report - Technical standards under SFTR and certain amendments to EMIR
Resolutions approved by the KDPW Management Board on 17 March 2020 in view of the integration of the Trade Repository (EMIR) application into the KDPW Group’s single access system from 1 April 2020 and the planned implementation of a new Trade Repository (SFTR) application, which will also be integrated into the single access system:
Resolution No. 226/20 defining the Terms and conditions of communication with the derivatives trade repository
in implementation of the power vested in the KDPW Management Board to determine the terms and conditions of communication with the trade repository referred to in § 10a of the Derivatives Trade Repository Rules – effective as of 1 April 2020;
Resolution No. 227/20 defining the Terms and conditions of communication with the securities financing transactions trade repository
in implementation of the power vested in the KDPW Management Board to determine the terms and conditions of communication with the trade repository referred to in § 11 subpara. 1 of the Securities Financing Transactions Trade Repository Rules – effective as of 1 April 2020;
Resolution No. 228/20 approving the Rules of access to the IT systems of Krajowy Depozyt Papierów Wartościowych
, which are incorporated into the terms and conditions of communication with trade repository participants in both services integrated into the single access system – effective upon publication, the obligation to use a trade repository in the services is effective as of 1 April 2020;
4/ Resolution No. 225/20
, amending the ARM Rules, authorising the single access system as a means of electronic communication with ARM for Trade Repository (EMIR) participants who are also ARM participants – effective as of 1 April 2020.