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The Securities Financing Transactions Regulation (SFTR) is a European regulation that introduces reporting requirements for securities financing transactions (SFTs). SFTs include repurchase transactions (Repos), securities or commodities lending and borrowing transactions (SBL transactions), buy-sell back or sell-buy back transactions, and Margin Lending Transactions. The reporting aims to enhance transparency and regulatory oversight of the SFT market.
When did this reporting requirement come into force and who does this apply to?
The SFTR reporting requirements came into force in July 2020 for credit institutions and investment firms.
Counterparties must report details of the SFTs they have concluded, modified or terminated to an authorized trade repository (TR). In addition to transaction reporting and collateral reporting, firms must report on Collateral Re-Use, Funding Sources, Margin Data and Cash Reinvestment.
SFTs must be reported on a daily basis, including collateral market values, collateral reuse, and margins. Modifications and terminations throughout the life cycle of a trade must also be reported.
Reports must be submitted before the end of day on T+1.
In the EU, SFTR reports must be submitted to authorized Trade Repositories.
SFTs must be reported using the ISO 20022 XML template applicable to each type of SFT. Counterparties can delegate reporting to a third party, but the full set of details that would have been reported separately by each counterparty must still be included