Corporate hedgers fear OTC liquidity drain

End-user exemptions could prove Pyrrhic victory, says treasury head

money-down-drain
Hedgers fear OTC market could shrink in size

Increased regulatory and capital requirements on banks could result in a dangerous, downward spiral in over-the-counter markets, with some end-users abandoning certain products because of cost, which would hurt liquidity and force others to follow suit.

"If costs increase, there will be less OTC availability, which is a huge problem for end-users. It would do serious damage. And less availability would impact liquidity and increase costs further, resulting in less derivatives hedging, which will

To continue reading...