Global watchdogs review derivatives clearing rules

LONDON (Reuters) - Two global regulatory bodies have teamed up to update five-year old guidelines for clearing houses following pressure from policymakers to centrally clear off-exchange traded derivatives and cut risk in markets.

The Committee on Payment and Settlement Systems -- part of the Bank for International Settlements -- and the International Organisation of Securities Commissions said the review would help ensure consistent interpretation of their 2004 guidelines aimed at ensuring clearing houses manage risks properly.

Several new clearing houses are being set up to clear trades in credit default swaps under a pledge made by the G20 group of industrialised and emerging market countries in April.

"Where necessary, the working group will ... identify any areas in which the recommendations might be strengthened or expanded to better address risks associated with the central clearing of OTC derivatives," the two bodies said in a joint statement.

In Europe, ICE (ICE.N) and Eurex Clearing (DB1Gn.DE) are expected to start clearing CDS trades from July 31, a deadline laid down by European Union's executive European Commission. Similar clearing services are already available in the United States.

(Reporting by Huw Jones, editing by Ron Askew)