US-European divergence over default funds

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Ignacio Solloa, deputy chief executive of Madrid-based central counterparty MEFF
Our philosophy has always been to have a relatively small default fund. We didn’t have a default fund until recently because our philosophy was to have a loss-sharing mechanism as small as possible. The risks have to be identified and covered by the risk-bearing member. If a member is producing risk, that should be covered by the collateral and the margins you require from that member. Only as a last resort should

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