Prior to the 2008 financial crisis there had been a complicated web of banking regulations that affected financial institutions around the world. In response to the financial crisis, regulators have been busy at work drafting new regulations aimed at reducing the chances of a similar meltdown in the future. Earlier this summer we released the Periodic Table of Bank Regulation and Compliance which helps identify and explain the various global regulatory regimes under which financial institutions now operate as well as several other regulations that are pending.
Part of the stepped up regulatory activity is the Global Legal Entity Identifier (LEI) initiative, which is being guided by the Financial Stability Board (FSB). The FSB “has been established to coordinate at the international level the work of national financial authorities and international standard setting bodies and to develop and promote the implementation of effective regulatory, supervisory and other financial sector policies in the interest of financial stability.”
The LEI concept has been discussed for many years. The resurgence of interest has been caused by the Dodd-Frank legislation which established the Office of Financial Research (OFR). The OFR, in November of 2010, published a policy statement to promote the establishment of a universal Legal Entity Identifier (LEI). In parallel, the CFTC and the SEC proposed rules for reporting swap derivative transactions that would utilize a universal identifier. To make this a global initiative, the FSB is now the guiding hand.
One of the advantages of the LEI will be to help map the many disparate entity identifiers that are currently in use at financial institutions. Entity identifier mapping is one of Alacra’s core competencies. For this reason we have released the Alacra Periodic Table of Entity and Security Identifiers. Please take a look and send us any comments you may have.