As the UMR Phase 4 and 5 deadlines approach, you may have a lot of questions about if and how you are impacted by UMR. Below are some of the common questions we receive.
No. Initial margin rules apply to any firm who is in-scope of their local margin rules and has an AANA during the relevant observation period for each year at or above the minimum threshold. If your AANA is above the threshold, your firm will be subject to Initial margin rules. For further detail on the UMR timeline & How & When AANA is calculated, see cmegroup.com/umr respective sections.
The observation period for Phase 5 (Sep 2020 deadline) for U.S. covered entities is as follows: June, July and August 2019.
For firms covered by jurisdictions, in the rest of world the Phase 5 observation period is as follows: March, April and May 2020.
No, as with the previous question, it depends on your threshold.
No, whether you will be in-scope is based on your AANA, which is calculated on open gross notional outstanding of non-centrally cleared derivatives.
Hedging tools are not exempt from derivatives used in the AANA calculation, which in turn is used to determine whether a firm is in-scope for UMR. See the tables in “Who and What Is In Scope for UMR?” section.
It may. Please reach out to your prime broker.
CME Group offers several solutions to help you overcome UMR challenges, across bilateral and cleared markets. Explore our comprehensive offerings here.
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