The largest lending institution in Southeast Asia announced on October 22 that it will not register with government agencies responsible for derivatives regulation in the United States for the purpose of trading with market participants in the nation.

DBS Group Holdings Ltd. is the first major lending institution to announce that it will not comply with regulations set forth by the U.S. Commodity Futures Trading Commission that compel foreign market participants doing business with U.S. entities to register, a bank executive stated, according to The Wall Street Journal.

DBS Bank managing director Tse Chiong Thio said that the bank fails to see what "immediate commercial benefits" will come as a result of the costs associated with registering with the CFTC, the media outlet reports.

The lending institution declined to comment on what the consequences of this decision would be for its business, but regional swaps traders specified that the area's banks have been engaged in swaps transactions with market participants in the United States, according to the news source.

Several market experts have predicted that the CFTC will face challenges in enforcing derivatives regulations in foreign countries, with International Financing Review reporting earlier in the year that extra-territoriality is a very complex subject.