comments_of_deutsche_telekom_ag_on_consultation_paper_final.doc - Comments of Deutsche Telekom AG on Consultation Paper ”Draft Technical Standards for


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Comments of Deutsche Telekom AG on Consultation Paper ”Draft Technical Standards for the Regulation on OTC Derivatives, CCPs and Trade Repositories“ (25 June 2012) Although the current draft addresses many important aspects of derivative regulation, Deutsche Telekom sees certain topics left unclear. In detail we believe that the following issues concerning non-financial counterparties are not adequately considered yet: 1. Bilateral Credit Support Annexes (CSA) with OTC-counterparties Since the start of the financial crisis in 2008 the implementation of Collateral Agreements in the corporate sector has increased rapidly. Today, CSAs are a well established mean for many non-financial counterparties to bilaterally limit their counterparty risks. Deutsche Telekom AG has also implemented bilateral CSAs with all its derivative counterparties which cover all types of derivatives traded. In our view, central clearing is of limited value when such a risk mitigating model is already established. Particularly we would like to highlight that not all derivatives can be cleared centrally for the time being; especially cross currency swaps which bear (by nature) a potentially higher risk than e.g. interest rate swaps. While these derivatives will not be included in a risk limiting
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  • Spring '14
  • JanetH.Keefer

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