Swaptions compensation method divides market

US and European firms back redress payments, but disagree over how they would work

Swaptions-compensation-mechanism-divides-opinion

Swaptions users are struggling to agree a method for compensating investors that lose out from the upcoming change in swap discount rate at clearing houses.

Market participants in the US and Europe broadly agree that a compensation mechanism is needed, but divisions still remain within each jurisdiction over how it would work in practice.

With any method of redress likely to be voluntary, there are concerns that beneficiaries of the rate switch will be loath to hand over windfall gains to the

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: