EU to propose greater transparency for default swaps on eight banks - EU document

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The European Commission will propose greater transparency in the trading of credit default swaps of eight top banks to mirror rules in U.S. markets, a European Union document seen by Reuters showed on Wednesday. So-called single name credit default swaps have come under regulatory scrutiny after the fall and state-backed rescue of Credit Suisse triggered high volatility on the CDS market for some systemic banks, Deutsche Bank in particular, on March 24. This would explain why a single, rather small CDS contract can trigger major moves in the price of both the CDS reference entity’s debt and equity, said the paper which proposes "targeted amendments" to the bloc's post-trade transparency rules for over-the-counter derivatives.