Italy’s UniCredit has publicly announced that it has no interest in registering to trade over-the-counter derivatives with US institutions, in the wake of industry experts’ warnings that incoming regulations are breaking the global links between markets and hurting liquidity.
So far, UniCredit is the largest bank to shun the US$640 billion over-the-counter US derivatives market, while regulators in Europe and Asia have also expressed concerns about the new US rules on its derivatives trade.
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TJ Lim, head of UniCredit’s capital markets business, said that "uncertainty" over the rules and concerns about being swept up by them meant that UniCredit has "decided not to register".
In late 2012, Singapore’s DBS and Sweden’s Nordea said they would not register as swap dealers with the US Commodity Futures Trading Commission, which will not allow them to trade with US institutions or companies when new regulations come into effect in July.
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