On 3 April 2018, FIA submitted a letter (attachment below) to the Singapore Exchange in response to their proposed refinements to the SGX-DC Clearing Fund structure. The proposed amendments are intended to enhance the robustness of the SGX-DC clearing fund and simplify its structure in line with the practices of global clearing houses.
FIA agreed with many of the proposals presented by SGX and supports that the clearing fund requirements will be determined using a risk-based methodology. However, FIA members seek additional clarity and transparency on the methodology that SGX will adopt when determining member contribution requirements. FIA also asked SGX to look at various factors (not only trading and clearing volume) when assessing a clearing member’s overall risk profile and stress loss.
SGX intends to implement the proposals in the third quarter of 2018 (subject to regulatory clearance).