Dealers claim regulators have cooked up a pro-cyclical credit value adjustment (CVA) capital charge that encourages CVA desks to buy credit default swap protection as a hedge. This could push spreads wider,...
Insurance Risk and BNY Mellon have conducted a survey to look at how insurance companies are preparing for the new regime and the opportunities and challenges that the changes will bring.
More Features/Derivatives articles
Europe’s revised Markets in Financial Instruments Directive appears to leave the door open for derivatives trading platforms to offer voice trading – but rules on transparency may slam the door shut. By Joe Rennison
Central clearing for over-the-counter derivatives could be jeopardised by draft capital rules that encourage banks to clear, but discourage them from providing intermediary services to other derivatives users. This client clearing business needs support,...
The potential for another systemic meltdown is a clear and present danger given the precarious state of eurozone public finances plus global debt and credit imbalances. But Asian investors are not rushing to buy crash protection. Rather, with implied...
European sovereign debt woes during the past quarter have heightened concerns about counterparty credit risk and led to a funding squeeze in arguably Asia’s most important currency – the US dollar. But some financial institutions with good credit...
Dealers say regulators have cooked up a pro-cyclical credit value adjustment capital charge that will force them to buy increasing amounts of protection in an illiquid market, regardless of changes in counterparty credit. The impact will be felt by uncollateralised...
In a world where central clearing and bilateral collateral posting are mandatory, margin efficiency will be a big draw, and one obvious way to achieve it is through cross-product margining. Unfortunately, it is difficult to achieve – and Commodity Futures...
Jefferies is suing International Derivatives Clearing Group over claims the central counterparty’s futures contracts would replicate over-the-counter swaps – a case that turns on collateral and margin differences in the cleared and uncleared markets....
This paper discusses a number of diverse considerations that risk managers need to incorporate into their thought processes and recurring procedures if they are to fulfill their role more effectively in the future
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