Goldman Sachs unit in Singapore applies for swap dealer status in US

Washington (Platts)--4Mar2014/125 pm EST/1825 GMT


A subsidiary of Goldman Sachs in Singapore has filed documents with the US-based National Futures Association to be recognized as a registered swap dealer, which brings with it an increased level of regulatory scrutiny with the US Commodity Futures Trading Commission.

The unit, J Aron & Company Singapore PTE, filed for membership and swap dealer status with the NFA on February 28. Directors for the group, San Miu Doris Cheung, Boon Leng Goh, Christopher McKey, Keng Leong Ng and Chin Thean Quek, registered as principles of the subsidiary with the NFA on Monday.

Since the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the largest swap market participants who trade with US persons have been required to register with the CFTC as swap dealers and face enhanced oversight, record keeping and reporting requirements.

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The J Aron group, which operates separately from other Goldman Sachs trading activities in Japan, primarily trades middle distillates and residual fuel oil, while also trading base metals and agriculture products.

The NFA, which oversees swap dealer registration on behalf of the CFTC, shows their registration status as pending.

The filing likely means that trading by the Goldman unit in Singapore has or is likely to exceed the CFTC's $8 billion de minimis threshold of swap dealing activity over the previous 12-month period, which requires registration.

Many energy companies or commodities trading units have largely managed to stay under that level as the majority of trading activity has moved to futures contracts, which do not count toward the threshold.

Firms have lobbied heavily against being labeled a swap dealer by the CFTC, saying the designation would increase the costs of supporting swap-trading activity and substantially increase collateral costs.

--Christopher Tremulis, christopher.tremulis@platts.com
--Edited by Jason Lindquist, jason.lindquist@platts.com

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