Fed’s Yellen sizes up challenges in derivatives reforms

Janet Yellen, the vice-chair of the Federal Reserve, on January 4 highlighted the trade-off between reducing systemic risk and imposing onerous requirements on the financial services industry.

Speaking at the annual meeting of the American Economic Association, Yellen said derivatives trades that were not centrally cleared would be subject to initial margin requirements but this risked imposing a heavy burden on financial firms. A study by the International Swaps and Derivatives Association