Dealers braced for Taiwan swaps clearing mandate

International banks are rushing to become clearing members at Taiwan Futures Exchange (Taifex) ahead of an expected directive from Taiwan’s financial regulator that will make it mandatory for banks to centrally clear their New Taiwan dollar (TWD) interest rate swap trades. Some dealers predict it could also lead to an expansion of foreign exchange derivatives clearing in the country. 

Market participants expect Taiwan’s Financial Supervisory Commission to make a formal announcement establishing a