The Securities Financing Transactions Regulation sets out transparency requirements for firms engaging in securities financing and lending transactions, including repurchase agreements, in the European Economic Area. The European Union passed the SFTR following work by the Financial Stability Board on creating a framework for overseeing shadow banking activity. The regulation requires firms to report securities financing transactions to trade repositories, similar to the requirement for derivatives under the European Market Infrastructure Regulation. The SFTR came into force in January 2016, with many of the requirements staggered over the following several years.
SECURITIES FINANCING TRANSACTIONS REGULATION (SFTR)
