Radoslav Raykov is a Principal Economist in the Financial Stability Department at the Bank of Canada. His research focuses on financial stability and has been applied to systemic risk in the banking sector, central counterparties, insurance companies and the insurability of rare, high-impact events. Prior to joining the Bank of Canada, he worked at the Federal Reserve Bank of Boston and taught at Harvard University. He holds a B.A. from Harvard University a Ph.D. in Economics from Boston College.
This paper investigates how financial market participants respond to risk mutualization implemented by a CCP using assessments after a large credit loss.