SBS Market Participants to Leverage Data Repository Service

With the SEC’s recent announcement that the first phase of SBS (Security Based Swap) trade reporting will begin on November 8, 2021, firms must now evaluate their operational readiness to report these transactions and ensure they meet their compliance obligations. 

Kate Delp, DTCC Executive Director and General Manager, DDR, told Traders Magazine: “As an approved security-based swap data repository (SBSDR), clients can leverage DTCC’s Global Trade Repository (GTR) service to report their transaction data directly to the SEC, bringing greater transparency and risk mitigation to the derivatives market.”

On Monday, May 11, the U.S. Securities and Exchange Commission (SEC) approved the DTCC Data Repository (DDR) application to operate as a registered security-based swap data repository.

With this registration, the security-based swap market now has the first SDR that can accept transaction reports. 

DDR, part of DTCC’s Global Trade Repository (GTR) service, will function as a registered SBSDR for transactions in the equity, credit, and interest rate derivatives asset classes.

“As an SBSDR, DTCC’s GTR service will serve as a centralized database of SBS transaction reporting data, providing the SEC with new insights into security-based swap data to enable transparency and surveillance, and marking the completion of the implementation of Dodd-Frank in the US for derivatives oversight,” Delp said. 

“In addition, information about these swaps will be made public for price transparency, beginning with compliance date two, which is expected to be February 14, 2022,” she added.

DTCC’s GTR service will be ready to start accepting SBS transaction data for reporting to the SEC in accordance with the anticipated first compliance date on November 8, 2021, though “industry testing will occur well before this time”, said Delp.

Regulation SBSR is a key component of the security-based swap regulatory regime established by Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act. 

Regulation SBSR provides for the reporting of security-based swap information to registered SDRs and for public dissemination of transaction, volume, and pricing information.

According to SEC Chair Gary Gensler, a centralized database of security-based swap transactions is “an essential reform to better understanding these markets, for surveillance and for enforcement”. 

“Implementing Regulation SBSR fulfills an important mandate under the Dodd-Frank Act. The data repository also will facilitate public reporting of security-based swap transactions, bringing much-needed transparency to these markets,” he said.