Improved transparency of certain financial transactions
European Parliament adopts Commission proposal to improve transparency of certain financial transactions in the shadow banking sector.
"Following a vote in the European Parliament, new EU rules are set to improve the transparency of certain financial transactions and help supervisors and investors better understand risks.
The European Commission welcomes today's adoption by the European Parliament of the Regulation on Transparency of Securities Financing Transactions (known as SFTR). This new law, proposed by the European Commission in January 2014, significantly improves the transparency of securities financing transactions in the shadow banking sector. These new rules also help identify the risks associated with these financial transactions, as well as their magnitude. This regulation is in line with the G20 leaders' commitment to ensure more transparency on financial markets.
Securities financing transactions (SFTs) allow market participants to access secured funding, i.e. to use assets, such as the shares or bonds they own, to secure financing for their activities. This involves the temporary exchange of assets as a collateral for a funding transaction (e.g. the lending or borrowing of securities, repurchase or reverse repurchase transactions, buy-sell back or sell-buy back transactions, or margin lending transactions)...."
Read the Press release: "European Parliament adopts Commission proposal to improve transparency of the shadow banking sector".