The U.S. Treasury Department exempted foreign-exchange swaps andforwards from Dodd-Frank Act regulations intended to reduce riskand increase transparency in the derivatives market.
Foreign-exchange swaps and forwards are short-term transactionsthat already have high-levels of transparency and risk management,the department said in a statement late Friday announcing the exemption. Deutsche BankAG, Bank of New York Mellon Corp., UBS AG and other banks urgedTreasury Secretary Timothy F. Geithner to exempt the market. Theexemption had been resisted by some regulators, Democraticlawmakers and advocates of tighter rules.
“Unlike other derivatives, FX swaps and forwards already tradein a highly-transparent, liquid and efficient market,” the TreasuryDepartment said. “This final determination is narrowlytailored.”
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