Regardless of what the European Commission says, various market participants have been wondering if the regulator will be able to meet its own strict deadlines.

Market commentators have arrived at a consensus, that the existing timetable leaves regulators with little room to make mistakes, according to Post Online. The regulations are currently required to be adopted at the beginning of 2013 by regulators, and by the start of 2014 for market participants.

The regulatory regime is currently awaiting a vote by the Economic and Monetary Affairs Committee that is scheduled for March 21, the media outlet reports. If the outcome of the vote is what market experts are expecting, the Ombinus II directive will become effective over the summer, which would allow Solvency II to be implemented on schedule.

This best-case scenario could be prevented by politicians who are preoccupied with the Greek debt situation or who are reluctant to approve legislation that could potentially reduce economic growth, according to the media outlet.

Greek officials have been focused on working on securing another round of bailout funding to prevent the European nation from defaulting on its debt when its next round of payments becomes due in March.

The creation of futures contracts based around credit default swaps (CDS) has been an objective of various market participants for more than one year, but the objective has been hindered by the complexity of creating such a financial instrument.

Various banks were working on creating a futures contract derived from an index of CDS, but these efforts have stopped after the market experts responsible for creating these financial instruments found it challenging to do so within a short time frame, sources familiar with the matter told The Wall Street Journal.

At present, the most widely-traded CDS indices are iTraxx Europe and CDX North America Investment Grade index, which are both offered by Markit, according to MarketWatch.

CDS-based derivatives have not been popular when offered in the past, the media outlet reports. In 2011, the Chicago Board Options Exchange listed credit-default options, but these financial instruments attracted little interest from traders, the media outlet reports.

Data provided by the Bank for International Settlements indicates that the notional value of CDS surged 8 percent during the first six months of 2011 to reach $32.4 trillion, according to the media outlet. At the end of June in that year, the risk management tools accounted for 5 percent of the $700 trillion swaps market. 

The Basel III capital requirements will obligate credit unions to treat member shares that can be redeemed without restrictions as liabilities on the balance sheets of the financial institutions. Alternatively, shares that credit unions can refuse to redeem can be treated as capital for Basel III purposes, the Credit Union Times reports.

Glen Westley reviewed the impact that implementing the Basel Committee on Banking Supervision’s most recent draft will have on credit unions in a World Council of Credit Unions web seminar held during the week that ended February 3, according to the media outlet.

Although the capital requirements mostly pertain to larger lending institutions, credit unions could potentially be subject to the new regulations, the media outlet reports.

The Basel III requirements would obligate eligible banks to establish a "buffer" of capital considered to be highly liquid by regulators, additional capital for banks who engage in excessive lending, and a ratio of capital to leverage that would protect banks in case their predictions of risk prove incorrect, according to the media outlet.

The National Credit Union Administration (NCUA) recently issued a request for comments on derivatives policies that the financial entities could use to manage risk, Credit Union Times reports. 

Malaysia's central bank announced on January 30 that it plans to make the trading of ringgit-based interest rate derivatives available to a greater range of market participants, which is meant to boost the competitiveness of the banks in the region.

The lending institution also plans to allow residents to trade foreign currencies through licensed onshore banks, according to Dow Jones Newswires. The country's central bank plans to allow licensed onshore banks to offer ringgit-denominated interest rate derivatives to both non-residents and financial entities that are not banks. The new regulations involving both currency trading and derivatives transactions will be instated on January 31.

The central bank said in a statement that "the above measures will contribute towards increasing the liquidity, depth and participation of a wider range of players in the domestic financial markets," Reuters reports.

Azrul Azwar Ahmad Tajudin, chief economist at Bank Islam, told the media outlet that the new offerings are designed to level the playing field, putting local banks on the same playing field as foreign competitors.

Reuters reports that the new offerings are part of a 10-year plan that is designed to help the Asian country attract more capital from foreign investors. 

Exchange operator CME Group and Chinese iron services firm Mysteel released a statement on January 20 indicating that they are planning to collaborate on the creation of over the counter (OTC) derivatives that will help market participants manage risk related to iron.

Mysteel has established partnerships with more than 20 metallurgical market entities and positioned itself as a major player in the country's steel e-commerce sector. The company gathers data on more than 60 cities throughout the country and currently boasts more than 600,000 members.

CME Group has generated a range of financial products that now offer market participants the ability to hedge their exposures related to iron and steel.

Harriet Hunnable, CME Group Managing Director, Metals, said in the statement that "this new opportunity with Mysteel will help us develop the tools needed for our customers to manage price risk associated with conducting business in the steel industry in China."

Reuters reports that a perfect example of the growing trading activity related to ferrous-based derivatives is the volume of iron-ore swaps transactions. Data provided by the media outlet indicates that July trading volume of these risk-management tools came close to an annualized rate of 50 million tons.